* Investors await details on Greek unity govt * Italian PM faces no-confidence vote * Copper stocks fall in London, rise in Shanghai By Maytaal Angel LONDON, Nov 7 (Reuters) - Copper fell on Monday, with investors struggling to see better demand prospects as economic and political difficulties in Greece and Italy fuelled concern that Europe's debt crisis is unravelling. Greece's politicians agreed late on Sunday to form a unity government to approve a euro zone bailout, but details remain thin, despite an EU ultimatum for Athens to get serious about tackling its huge problems. Fuelling this gloomy outlook were events in Italy, where Prime Minister Silvio Berlusconi has one day left before a parliament vote on public finance after his government failed to adopt reforms to defuse a dangerous debt crisis. Three-month copper on the London Metal Exchange traded at $7,810 a tonne in official rings, down from Friday's close of $7,865 a tonne. Earlier the metal fell to a low of $7,719.75 a tonne. "Markets are nervous and given the economic slowdown not only in the eurozone, we have a cautious assessment in the near term," said Credit Suisse analyst Tobias Merath. But he added: "We think recession can be avoided and ultimately the valuation argument will be more convincing - (metals) are starting to look cheaply valued - and over one year we have a favourable forecast." The deal on the new Greek coalition still lacks an agreed prime minister, a duration and a clear mandate, though it will allow Greece to collect the international loan installment it needs before it runs out of cash in December. But investor attention has now shifted to Italy, the euro zone's third-biggest economy, which poses a far graver risk to the eurozone than Greece. With its borrowing costs soaring and 1.9 trillion euros in public debt, it is too large to bail out. "Policy markers' solutions and plans still seem to be lacking. In this environment and with the need for budget deficits to be cut to get to the root of the problems, it seems very hard not to expect recession to follow," said BaseMetals.com analyst William Adams in a note. Italian/German 10-year government bond yield spread hit its widest levels since 1997 on Monday, a day before Prime Minister Silvio Berlusconi faces a no-confidence vote. SUPPLY SQUEEZE Ongoing signs of increased tightness in the supply of metals offered support. Latest LME data showed copper stocks held in official warehouses fell 2,525 tonnes to 415,325 tonnes, down more than 12 percent since the start of October. "Inventories at the LME continue to fall, while latest data from the Shanghai Futures Exchange show mostly rising inventories. As a consequence of this mixed data, we have seen fairly large two way price swings recently. This week, we could see calmer trading conditions," said Credit Suisse in a note. Also limiting losses in metals was news from China. According to the China Securities Journal, the world's top copper consumer is likely to inject more than 1 trillion yuan ($158 billion) into the money market in the next two months via annual subsidies from the Ministry of Finance. In industry news, CME Group and Intercontinental Exchange Inc lowered margin requirements on some accounts in a move over the weekend to limit the fallout from the MF Global Holdings Ltd bankruptcy on futures markets. In other metals traded, soldering metal tin was at $21,950 a tonne in official rings, from $22,050 on Friday. Zinc , used in galvanizing was untraded in official rings, but bid at $1,926 a tonne from $1,950 a tonne on Friday. Tin remains underpinned by the fact that 25 smelters in the world's largest tin exporter are maintaining a self-imposed tin ingot shipping ban until the end of December, as they look to support benchmark prices. Battery material lead was untraded in official rings, but bid at $1,997 a tonne from $2,048. Aluminium was at $2,142 a tonne from $2,141 and nickel traded at $18,670 a tonne from $18,900 Metal Prices at 1306 GMT Comex copper in cents/lb, LME prices in $/T and SHFE prices in yuan/T Metal Last Change Pct Move End 2010 Ytd Pct move COMEX Cu 354.35 -2.10 -0.59 444.70 -20.32 LME Alum 2138.25 -2.75 -0.13 2470.00 -13.43 LME Cu 7820.75 -44.25 -0.56 9600.00 -18.53 LME Lead 1998.00 -50.00 -2.44 2550.00 -21.65 LME Nickel 18651.00 -249.00 -1.32 24750.00 -24.64 LME Tin 21900.00 -150.00 -0.68 26900.00 -18.59 LME Zinc 1927.00 -23.00 -1.18 2454.00 -21.48 SHFE Alu 16275.00 -105.00 -0.64 16840.00 -3.36 SHFE Cu* 57950.00 -1410.00 -2.38 71850.00 -19.35 SHFE Zin 15345.00 -205.00 -1.32 19475.00 -21.21 ** Benchmark month for COMEX copper * 3rd contract month for SHFE AL, CU and ZN SHFE ZN began trading on 26/3/07

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