* Copper trades in tight range so far this week * Copper stocks in LME warehouses fall to fresh 32-month low * U.S. weekly jobless claims fall to four-year low By Harpreet Bhal LONDON, March 15 (Reuters) - Copper prices steadied on Thursday, recovering after a 1 percent drop in the previous session, but concerns about the outlook for demand from top consumer China weighed on sentiment and kept prices within a tight trading range. Benchmark copper on the London Metal Exchange (LME) traded at $8,480 a tonne in official rings, after closing at $8,460 on Wednesday. Prices for the metal used in power and construction have seesawed between around $8,400 and $8,600 this week, as investors weigh an overall improved global economic growth outlook against the disappointing copper demand recovery in China. "On the fundamental side you have two opposite forces - you have the U.S economy which is improving and on the other hand the demand in China is still weak so there is a lack of fundamental drivers," said Gianclaudio Torlizzi, partner at T-Commodity. Latest U.S. claims for unemployment benefits fell back to a four-year low last week, a government report showed on Thursday, suggesting further strengthening in the labour market. Helping keep copper prices from falling further was a rebound in the euro, which bounced off one-month lows against the dollar, while European shares paused near eight-month highs. A weak dollar makes commodities priced in the U.S. unit cheaper for holders of other currencies. "Moves in financial markets are a risk to the downside for base metals. We are ready to go short in case the equity market loses steam," Torlizzi said. Copper has risen around 11 percent so far this year, after a 21 percent slide in 2011, on a brightening economic outlook in the United States and hopes that easy monetary policies around the world would buoy asset prices. But the demand from China, which consumes 40 percent of the world's copper, is key to the outlook for prices. "The demand this year is not looking particularly good, as the cycle of rapid economic growth driven by fixed asset investment is over and export-driven growth is also easing," said Zhu Bin, an analyst at Nanhua Futures in the eastern Chinese city of Hangzhou. Premier Wen Jiabao said on Wednesday China must embrace slower growth and bolder political reform to keep its economy from faltering. He also dampened hopes for any near-term easing measures in the country's property sector. FALLING LME STOCKS LME copper stocks continued to fall, down 2,875 tonnes to 267,750 tonnes, the lowest level since July 2009. The ratio of cancelled warrants - material earmarked for delivery - to the total stocks was 33.47 percent. Large amounts of copper have been moving from LME warehouses to China over the past few months, pushing Shanghai copper stocks to their highest in a decade, overshadowing a sluggish rebound in copper demand after the Lunar New Year holiday. Analysts said some Chinese companies were using part of the copper inflow as collateral to obtain credit or selling for cash to finance other investments, while real consumption remains sluggish. "Chinese corporations are surprisingly cautious on China right now," said Jeremy Friesen, commodity strategist at Societe Generale in Hong Kong, but added that Beijing's pro-growth policy should help support healthy base metals demand through the rest of the year. "Beijing has enough ammunition both on the fiscal and monetary side to shore up the markets when they need to, and we expect they will. They will be there to offer support to keep growth at a healthy 8.1 percent this year." Earlier this month, China cut its 2012 growth target to an eight-year low of 7.5 percent, though traders saw this figure as still good. Actual growth in the world's second largest economy has surpassed the government's target in the past years. Zinc traded at $2,084 in official rings, from a close of $2,074, while lead was at $2,125 from $2,012. Nickel was at $19,250 from a close of $19,575. Aluminium was untraded in rings, but bid at $2,237 from Wednesday's close of $2,229. Tin, also untraded in rings, was bid at $23,600 from $23,800. Metal Prices at 1310 GMT Comex copper in cents/lb, LME prices in $/T and SHFE prices in yuan/T Metal Last Change Pct Move End 2010 Ytd Pct

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