* Aluminium hits 7-month low, nickel falls to 4-month trough * India's biggest plant closes for at least a week * Copper inventories rise to highest since Oct. 2003 By Silvia Antonioli and Melanie Burton LONDON/SINGAPORE, April 3 (Reuters) - Copper fell to an eight-month low on Wednesday as concerns about economic growth cast doubts over the global industrial metals demand outlook and pushed speculators to open more short positions ahead of a two-day holiday in China. Benchmark copper on the London Metal Exchange fell by 0.3 percent to $7,444.50 a tonne by 0952 GMT from $7,465 at the close on Tuesday. Earlier this session it hit a low of $7,404.50, its lowest since early August. LME aluminium fell to a seven-month low, lead to a five-month low and nickel to its lowest in four months. "Market sentiment has completely gone, it is with equities now, not with metals, and fundamentals are not improving. Premiums are still low, inventories are rising and the copper forward curve in London remains firmly in a contango," said Andrey Kryuchenkov, an analyst at VTB Capital. "We are seeing more stocks going in than out at the moment. Fundamentally we are not there just yet and on the macro front there are concerns about growth." Downbeat manufacturing data released earlier this weak from the United States raised concerns about the pace of a recovery in the world's largest economy. At the same time swelling stocks of metals in LME-registered warehouses signal some weakness on the demand side. Traders said fund-based momentum-driven selling had emerged as European markets opened, partly because metals had fallen below key technical levels of support. "Europe opened and it was sell, sell, sell," a Singapore-based trader said. Traders are now watching reports on the U.S. labour market, with the headline payrolls report due on Friday. A better than expected figure could signal an early end to bond buying, eroding liquidity and speculative demand for metals. Chinese markets are shut for a two-day break from Thursday. SUPPLY DEMAND BALANCE Raising worries about demand, inventories of copper in LME-approved sheds rose by 1,200 tonnes to 572,325 tonnes, their highest since October 2003, data released on Wednesday showed. Also, LME stocks of zinc, nickel and aluminium are at or near record highs. On the supply side, the Sterlite Industries Ltd's copper plant in India, which supplies half of India's domestic copper needs with output of more than 300,000 tonnes per year, will stay closed at least until a hearing next week about a gas leak reported at the site. This, however, represents a very small loss when compared with growing production in top producer Chile, which according to figures released last week saw its output grow by a 2.8 percent in February from a year earlier to 420,207 tonnes, on improved ore grades and higher output. In other metals, zinc was at $1,862.50 from $1,854 at Tuesday's close. More than half of global zinc demand comes from the steel sector for use in galvanising "The zinc industry is in surplus and production has begun to pick up, probably outpacing demand," said analyst Sijin Cheng of Barclays Capital in Singapore. . Battery material lead was at $2,052 from $2,050. Earlier it hit its lowest since late October at $2,034. Aluminium was at $1,876.25 from $1,884. It earlier hit its lowest since late August at $1,869. Tin was at $22,675 from $23,000 while nickel was at $16,165 from $16,380 after having hit its lowest since mid November at $16,160.

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