(Recasts, updates prices, adds details) * Copper falls to 3-week low, below support at $8,280/T * Euro falls vs dollar on Greece bailout delay * Moody's might cut credit ratings of 114 European institutions By Harpreet Bhal and Maytaal Angel LONDON, Feb 16 (Reuters) - Copper fell to a three-week low on Thursday, breaking below a key support level, as delays in securing a crucial bailout package for highly indebted Greece undermined sentiment, halted the rally for risk assets and pushed the euro lower against the dollar. Three-month copper on the London Metal Exchange traded at $8,251.75 a tonne at 1443 GMT, down from a close of $8,370 on Wednesday. It earlier hit its lowest level since Jan. 23 at $8,204.75 a tonne, breaking below $8,280, which is seen as a key support level. Copper has risen around 9 percent so far this year. Recent market confidence that negotiations between Greece and the European Union would be successful were undermined Thursday by growing public acrimony between Athens and its euro zone partners, led by Germany. Time is running out for Greece to avoid a potentially chaotic default, with Athens due to initiate a debt swap with its private bondholders by Friday to meet a March 20 deadline to repay 14.5 billion euros in debt. "What this means for metals is more to do with how it affects China and America. America has a fragile economic recovery and it (the Greek debt crisis) is hurting Chinese exports to the eurozone. I think copper could dip to $8,000 or $7,900, depending how long people are willing to take profits," said VTB Capital analyst Andrey Kryuchenkov. The euro fell to a three-week low versus the dollar in response to the troubles over Greece, making dollar priced metals more expensive for European and other non-U.S. investors. Adding to negative sentiment, Moody's warned it might cut the credit ratings of 17 global and 114 European financial institutions in another sign the impact of the euro zone government debt crisis is spreading throughout the global financial system. "From a fundamental perspective, the copper market is very tight, but if the (eurozone) crisis deepens, it will impact global growth and developing countries' consumption of raw materials," said Caroline Bain, an economist with the Economist Intelligence Unit (EIU). On the plus-side, however, U.S. data showed jobless claims unexpectedly fell last week to a near four-year low, another sign of improvement in the labor market of the world's largest economy, while January housing starts were also better than forecast. CHINA DEMAND UNCERTAINTY Concerns also lingered in the metals market about the demand outlook for top copper consumer China, which has yet to pick up after the week-long Lunar New Year holiday late in January, in part due to lower order visibility on products for export to debt-laden Western economies. "There are concerns about Chinese demand, the closed arbitrage window and lower January imports, but that overstates the situation because the Lunar New Year fell earlier this year," said Matt Fusarelli of Australia-based consultancy AME Group. "We're still quite bullish on copper prices, expecting around $4 a pound ($8,818 a tonne) in the second quarter." In industry news, output from the world's largest copper mine, Chile's Escondida, plummeted 24.6 percent in 2011 from a year earlier to its lowest level in nearly a decade on sinking ore grades and a two-week strike, the mine said late on Wednesday. In other metals, aluminium traded down at $2,162 a tonne from Wednesday's close of $2,200, while battery material lead was down at 2,012 from a close of $2,062. Zinc, used in galvanizing, fell to $1,965 from $2,012 a tonne, tin at $24,125 from $24,595 and nickel down at $19,819 from $20,075. The global nickel market was in a supply surplus by 17,000 tonnes last year, the latest monthly bulletin from the Lisbon-based International Nickel Study Group (INSG) showed. Metal Prices at 1446 GMT Metal Last Change Pct Move End 2009 Ytd Pct move LME Alum 2163.50 -36.50 -1.66 2230.00 -2.98 LME Cu 8219.00 -151.00 -1.80 7375.00 11.44 LME Lead 2007.00 -55.00 -2.67 2432.00 -17.48 LME Nickel 19825.00 -250.00 -1.25 18525.00 7.02 LME Tin 24100.00 -495.00 -2.01 16950.00 42.18 LME Zinc 1972.00 -40.00 -1.99 2560.00 -22.97 SHFE Alu 16125.00 -95.00 -0.59 17160.00 -6.03 SHFE Cu* 59210.00 -1220.00 -2.02 59900.00 -1.15 SHFE Zin 15605.00 -340.00 -2.13 21195.00 -26.37 ** 1st contract month for COMEX copper * 3rd contract month for SHFE AL, CU and ZN SHFE ZN began trading on 26/3/07

Source