MARKETS-METALS (UPDATE 4)
* Uncertainty to check bullishness
* Falling LME stocks help support
* Coming up: U.S. jobs data due at 1230 GMT
(Adds official prices)
By Pratima Desai
LONDON, July 2 (Reuters) - Copper bounced on Friday as the dollar fell against a basket of major currencies but nervousness about global economic growth and demand were expected to check price gains.
Benchmark copper on the London Metal Exchange was untraded in official rings, but bid at $6,475 a tonne from $6,335 at the close on Thursday when the metal used in power and construction hit a two-week low of $6,318 a tonne.
The dollar slipped against the euro as currency markets factored in a spate of below consensus economic data, making metals cheaper for holders of other currencies.
Behind the latest sell-off in industrial metal markets has been below-consensus readings from surveys of the manufacturing sectors in the United States and China, the world's top two consumers of copper.
"Nothing fundamental has changed, there is a lot of economic uncertainty, the pressure remains to the downside," said Stephen Briggs, analyst at BNP Paribas. "It has become a global thing, ranging from China to the United States to Europe."
Euro zone manufacturing slowed in June to its weakest growth rate in four months but was unrevised from a survey estimate just over a week ago.
Staying with the theme of economic data, markets are waiting for a key U.S. jobs report for June at 1230 GMT. The series is notoriously volatile, but markets and analysts see it as an important gauge of economic health.
GALVANISING ZINC
Also weighing on metals was news that Australia ended a damaging dispute with global miners by dumping its "super profits" tax for a lower resources rent tax backed by key global miners.
As a result Swiss-based Xstrata reinstated about A$600 million of copper mining and exploration projects in Australia.
"It's not a big number by itself, but if others follow, it does mean higher supplies down the road," a metals trader said.
But he added that stocks in LME warehouses were still falling and that would help prop up sentiment.
Stocks of copper fell 2,125 tonnes to 447,300 tonnes, the lowest since early December last year. Aluminium stocks were down 5,150 tonnes to 4.2 million tonnes, about 220,000 tonnes below the record high of 4.64 million tonnes set in January.
Aluminium, used in transport and packaging, is also supported by financing deals that have tied up more than 70 percent of LME inventories.
Three-month aluminium traded at $1,956 a tonne in the rings from $1,926 at the close on Thursday. Zinc was bid at $1,801 from $1,743 on Thursday. Earlier the metal used to galvanise steel jumped more than 4 percent to touch $1,820.
Galvanised steel producers are estimated to account for more than 50 percent of global zinc demand estimated at around 12 million tonnes this year.
"An increase in activity ... has led to an improved fundamental backdrop. Some of the steel production increases were driven by restocking," Bank of America said in a note.
"In Germany, for instance, we believe that investment in galvanised steel stocks added around 2 percent to the country's zinc consumption."
Lead was bid at $1,761 a tonne from $1,735 on Thursday, tin at $17,300 from $16,960 and nickel at $19,150 from $19,000.
Metal Prices at 1227 GMT Metal Last Change Percent Move End 2009 Ytd Percent
move COMEX Cu 290.70 4.20 +1.47 334.65 -13.13 LME Alum 1945.00 19.00 +0.99 2230.00 -12.78 LME Cu 6445.00 110.00 +1.74 7375.00 -12.61 LME Lead 1745.00 10.00 +0.58 2432.00 -28.25 LME Nickel 19050.00 50.00 +0.26 18525.00 2.83 LME Tin 17200.00 240.00 +1.42 16950.00 1.47 LME Zinc 1785.00 42.00 +2.41 2560.00 -30.27 SHFE Alu 14775.00 170.00 +1.16 17160.00 -13.90 SHFE Cu* 52350.00 1010.00 +1.97 59900.00 -12.60 SHFE Zin 15015.00 555.00 +3.84 21195.00 -29.16 ** 1st contract month for COMEX copper * 3rd contract month for SHFE AL, CU and ZN SHFE ZN began trading on 26/3/07 (Editing by Alison Birrane)
