* LME aluminium holds near 1-month lows; auto sales support * Nickel momentum splutters; eyes 1st weekly loss in 5 * Coming up: US nonfarm payrolls for April at 1230 GMT (Updates with official prices) By Susan Thomas LONDON, May 2 (Reuters) - Copper rose on Friday but was set to log its biggest weekly loss in seven after the United States' decision this week to further trim its stimulus programme, which has provided commodity markets with liquidity. Trading was quiet though due to a holiday in top copper consumer China and ahead of a U.S. jobs report, which is expected to show that a strengthening economy likely encouraged employers to maintain a strong pace of hiring in December. The employment data would further support the U.S. Federal Reserve's decision to continue curtailing its massive monetary stimulus - a negative for commodities like copper because it withdraws liquidity from the market. Three-month copper on the London Metal Exchange, untraded in official rings, was bid at $6,665 a tonne, after closing little changed in the previous session. Copper prices are down around 2 percent this week. "I suspect the market has already positioned for good employment data and a hint of more tapering," Citi analyst David Wilson said. Solid demand from China has underpinned copper prices, and tight credit conditions has meant that fabricators in the world's top consumer of the metal have been running down their stocks, Wilson said. This has lifted China copper market premiums - the price paid on top of local cash futures prices to get metal - to the highest level in almost three years. Copper inventories in warehouses monitored by the LME are hovering at around 230,000 tonnes, down almost 70 percent from mid-2013. "To me it looks like the copper market has turned a bit and is looking slightly better supported," Wilson said. "There definitely seems to be an attitude change amongst investors towards copper to the point where we have more people talking about playing copper against aluminium; going long copper, short aluminium." Benchmark three-month aluminium touched a one-month low of $1,777.50 per tonne on Friday, and was $1,778 per tonne in rings from $1,785 at the close on Thursday. Aluminium was supported somewhat by figures showing the U.S. auto industry rebounded sharply in April from a bitter and extended winter, with car sales rising 8 percent from the previous year. Activity in China's factories increased marginally in April but export orders fell sharply, a survey showed on Thursday, adding to questions about whether the world's second-largest economy is stabilising after its first-quarter slowdown. But in the U.S., consumer spending recorded its largest gain in more than 4-1/2 years in March and factory activity accelerated last month, reinforcing views the economy was regaining steam. A strengthening economy likely encouraged employers to maintain a strong pace of hiring in December, further supporting the Federal Reserve's decision last month to start curtailing its massive monetary stimulus. U.S. non farm payrolls for April are due later in the session. Momentum in star performer nickel, which has seen gains of 31 percent this year, has begun to sputter, broker Triland said in a note. "We will be watching (the) weekly close ... as we may be heading for the first "down" week in five, suggesting bullish momentum may be waning after an impressive run," it said. LME nickel prices have soared this year over availability concerns after a ban on exports from top ore supplier Indonesia and on worries that top refined producer Norilsk Nickel, could be hit by sanctions over Russia's actions in Ukraine. Benchmark LME nickel was $18,225 per tonne in rings from $18,285 at the close on Thursday. Benchmark LME zinc was $2,012 per tonne in rings from $2,020 and lead was $2,082 from $2,090. LME tin , untraded in rings, was bid at $22,850 from $22,860. China's markets were closed on Friday for a second day, while many continental European markets are set to reopen after a May 1 break. The LME will be shut on Monday due to a holiday in Britain.

Source