SHANGHAI (Dow Jones)--Copper slipped on the Shanghai Futures Exchange Thursday, as investors stayed on the sidelines ahead of a key European leaders meeting due to start later in the day. The benchmark February copper contract lost 0.4% to settle at CNY57,810 a metric ton. The red metal has vacillated between gains and losses over the past four sessions as investors avoided making big bets before the European Union summit, which could potentially deliver a comprehensive plan to address the region's debt crisis. "Everyone is extremely cautious" ahead of the summit, said a Shanghai-based trader, adding that copper may continue to trade in recent ranges over the next few sessions, with dollar movements and equities sentiment providing cues. Investors will also watch for China's inflation data, due Friday along with a slew of other economic data, traders said. The major gauge for inflation likely rose 4.4% on year in November compared with a 5.5% rise in October, according a the results of a Dow Jones Newswires survey. If the November figure is in line with expectations or lower than expected, there may be renewed hopes for further monetary loosening in China to follow up on the central bank's unexpected announcement last week of a reserve-requirement cut. The 50-basis-point cut, which went into effect Monday, marked a shift in the government's emphasis to supporting economic growth and away from combating inflation. Copper traded at the Changjiang Nonferrous Metals Trading Market, a major spot metals market in Shanghai, was quoted at CNY58,000/ton-CNY58,100/ton compared with CNY58,150/ton-CNY58,300/ton Wednesday. Three-month LME copper ended Wednesday's PM kerb $14 lower at $7,820/ton. It was quoted $5 higher at $7,825/ton around 0700 GMT, when the SHFE closed. Benchmark aluminum was down 0.3%. An increase in electricity prices should support China's aluminum prices, as costs will rise for producers who don't have their own power plants, Galaxy Securities Futures analyst Sun Lei said: "Higher production costs have seen some aluminum smelters in Henan province idle capacity and some in Guizhou province extend their production closures." Electricity accounts for nearly 50% of aluminum's production cost. The latest hike works out to an average cost increase of CNY420/ton across the nation, while smelters in Guizhou province face a CNY700/ton cost increase, Sun said. With slower supply growth of primary aluminum and rising output of semi-finished aluminum products, which are direct consumers of primary aluminum, "prices should be well-supported at CNY16,000/ton going forward," he added. Benchmark lead settled unchanged, while zinc was 0.2% lower. Thursday's settlement prices in yuan a metric ton and LME late kerb prices from Wednesday in dollars a ton: SHFE LME Copper Feb 57,810 Dn 240 3Mo 7,820 Down 14.0 Aluminum Feb 16,135 Dn 50 3Mo 2,077 Down 34.5 Zinc Feb 15,735 Dn 25 3Mo 2,026 Down 18.0 Lead Jan 15,715 Unch 3Mo 2,147 Up 22.0 -Yue Li contributed to this article; Dow Jones Newswires; (8621) 6120 1200; yue.li@dowjones.com

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