* Shanghai Nov copper falls to 54,540 yuan, lowest in over 1 mth * LME copper extends loss from steepest fall in over 1 mth * Spanish region Murcia may seek aid after Valencia * Coming up: Euro zone consumer confidence for July; 1400 GMT (Updates prices; adds quotes, details) By Carrie Ho SHANGHAI, July 23 (Reuters) - Copper prices retreated on Monday amid growing concerns of a spreading debt contagion in the euro zone as Spain risks becoming the fourth country in the bloc to seek a sovereign bailout, denting the outlook for metals demand worldwide. Worries about the health of the global economy pushed Shanghai copper futures down more than 2.5 percent, bringing prices to their lowest since June 29. The most active November copper contract dropped as low as 54,540 yuan ($8,600) per tonne, its biggest percentage fall since June 4, before recovering some ground by the midday trading break. Three-month copper on the London Metal Exchange had fallen 0.6 percent to $7,503.50 per tonne by 0418 GMT, extending losses after a decline of 2.4 percent in the previous session, the most since June 21. "Shanghai copper is mostly playing catch up with London copper, which fell steeply on Friday due to concerns about the Spanish economy," said a Shanghai-based trader. "Chinese investors are also more sensitive to bad news lately, given that China's economy is evidently slowing down while physical copper demand has been sluggish as well." Looking forward, market players said they expected major governments to introduce more stimulus to stabilise the world economy, which has been dented by slowing growth in China, a shaky recovery in United States and mounting debt problems in the euro zone. Such policies are expected to boost metal prices, at least temporarily. Investors grew jittery about Spain's finances after the tiny region of Murcia said it would seek financial assistance from the central government, and media reported that half a dozen local governments were ready to follow in the footsteps of Valencia, which has already requested help from the central government to stay afloat. Elsewhere in the euro zone, Greek Prime Minister Antonis Samaras said the country was in a "Great Depression" similar to the American one in the 1930s, two days before international lenders arrive in Athens to push for additional cuts needed for the debt-laden country to qualify for further rescue payments to keep it afloat. Traders are awaiting manufacturing data from China and Europe, due on Tuesday, for further clues on the health of the global economy and its implications for metals demand. "The next trading cues we are looking forward to are news of new stimulus measures in China and the United States, and concrete measures to deal with Spain's problems," said an analyst with a international trading firm. "The next stimulus measure to watch is an expected Bank reserve ratio cut by China. But we don't think this will be rolled out in July since it would be too soon after the last interest rate cut." The grim economic backdrop offset an International Copper Study Group report on Friday that said the global refined copper market was in a 384,000-tonne deficit from January to April 2012, up sharply from a 26,000-tonne deficit during the same period of 2011. The report implied some support from fundamentals for copper prices at current levels, but bearish market sentiment and global economic uncertainties are weighing on the demand outlook and discouraging investors from buying. Base metals prices at 0418 GMT Metal Last Change Pct Move YTD pct chg LME Cu 7503.50 -41.50 -0.55 -1.27 SHFE CU FUT NOV2 54720 -1190 -2.13 -1.64 LME Alum 1888.00 -4.00 -0.21 -6.53 SHFE AL FUT OCT2 15390 -200 -1.28 -2.84 HG COPPER SEP2 340.75 -4.05 -1.17 -0.83 LME Zinc 1834.00 -5.50 -0.30 -0.60 SHFE ZN FUT NOV2 14565 -150 -1.02 -1.55 LME Nickel 15789.00 -161.00 -1.01 -15.61 LME Lead 1875.00 -26.00 -1.37 -7.86 SHFE PB FUT 14880 -115 -0.77 -2.68 LME Tin 18730.00 -200.00 -1.06 -2.45 LME/Shanghai arb 1335 Shanghai and COMEX contracts show most active months ^ LME 3-m copper in yuan, including 17 pct VAT, minus SHFE third month ($1 = 6.3735 Chinese yuan) (Reporting by Carrie Ho; Editing by Joseph Radford and Chris Lewis)

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