* Euro off session lows, but pressured versus the dollar
* Aluminium supported near cost curve; technically neutral
* LME/SHFE arbitrage supports prices
LONDON, July 19 - Copper bounced from a two-week low on Monday as a hefty stock drawdown underpinned prices, but traders saw gains limited due to economic growth worries and renewed jitters about euro zone debt problems.
Poor economic data from the United States, the world's biggest economy and a major metals consumer, spooked investors on Friday, sending U.S. stock markets sharply down and weighing on the sentiment.
On Monday, European shares slipped, tracking U.S. and Asian peers, while a suspension of a review of Hungary's funding programme over the weekend as well as a cut in the rating of Ireland's sovereign bonds has further escalated nervousness in the market.
Copper for three months delivery on the London Metal Exchange rose to $6,538 a tonne by 0900 GMT, versus $6,485 a tonne on Friday. The metal, used extensively in construction and in wiring, dropped to a two week-low of $6,470 a tonne earlier.
"We had a fairly substantial sell-off on Friday and I think this morning's move is a bit of a reaction to that," said Stephen Briggs, senior metals strategist at BNP Paribas, adding that a big fall in copper inventories has also been supportive.
"But I don't think there's much reason for copper to go higher. You've got concerns over Hungary which is raising risk-aversion a bit," he said.
The euro bounced from earlier session lows versus the dollar, but the sentiment was still dented by the wider debt picture, while traders awaited results of bank stress tests.
A stronger euro versus the dollar makes dollar-priced industrial metals cheaper for holders of the european currency.
"The whole base metals complex is being influenced more by the macro situation than individual metal fundamentals," said Judy Zhu, analyst at Standard Chartered in Shanghai.
Traders said that while the overall market was comfortable trading a fairly narrow range - for copper it has been between $6,300-6,900 moves towards either end sparked activity.
SUPPORTIVE
Another hefty stock drawdown on Monday brought total copper stocks to 422,850 tonnes, their lowest since November 2009 while a rise in cancelled warrants -- material earmarked for delivery -- of 2,250 tonnes tonnes, brought the total to 31,275 tonnes, equivalent to 7.4 percent of the total stocks.
In addition, traders said Chinese bargain hunters lifted copper. "We understand out of Asia this morning that traders are taking advantage of the SHFE/LME arbitrage with steady buying of LME copper," analyst Daniel Brebner at Deutsche Bank said in a note to clients.
Looking ahead, traders will keep an eye on Fed chairman Ben Bernanke's testimony to U.S. lawmakers and euro zone banks to find out how they fared in stress tests.
Aluminium rose to $1,984 a tonne from Friday's $1,978 a tonne. Prices have fallen 11 percent this year, but Standard Chartered's Zhu said further falls were unlikely.
"Aluminium should find support from here because we are very close to average costs of production," she said, adding the market could rebound but any gains were capped at around $2,200. Steel-making ingredient nickel was at $19,064 a tonne from $18,950 while battery material lead traded at $1,780 from $1,770.
Zinc gained to $1,809 a tonne from $1,797 and tin was last at $18,000 from $17,750.
Metal Prices at 0859 GMT Metal Last Change Percent Move End 2009 Ytd Percent
