December 28, 2017 / 1:35 AM / a year ago

METALS- LME copper gives back a little but holds at 4-yr peak

SYDNEY, Dec 28 (Reuters) - London copper eased slightly in early Asian trading on Thursday, but largely held sharp overnight gains that drove the contract to a four-year high on signs of strong demand from China next year.

Commodities traders said some profit taking emerged at the higher end of copper’s price rise, but was held in check somewhat by a weaker U.S. dollar.

Non-U.S. holders of U.S. dollar-denominated commodities, such as London Metal Exchange contracts, typically sell into a stronger dollar.

FUNDAMENTALS

* Three-month copper on the London Metal Exchange slipped 0.19 percent to $7,225 a tonne by 0100 GMT. The contract in the more active London session overnight touched $7,259, its highest since January 2014, when it hit $7,460 a tonne, according to Thomson Reuters data.

Prices of the metal used widely in power and construction are up 30 percent in the year to date.

* The most-traded copper contract on the Shanghai Futures Exchange gained 0.36 percent to 55,310 yuan ($8,436.55)a tonne.

* COPPER TC/RC SET: China’s leading copper smelter Tongling Nonferrous Metals Group 000630.SZ has agreed with Freeport-McMoRan Inc for treatment and refining charges (TC/RCs) at $82.25 per tonne and 8.225 cents per pound as the 2018 benchmark, a company source with the smelter told Reuters on Wednesday.

CAPACITY AND INVENTORIES: Bullish sentiment in the aluminium market was reinforced by news that China’s government has criticised officials in the industrialised province of Shandong for deceiving authorities to evade capacity cuts in the polluting coal, steel, aluminium and chemicals sectors.

However, aluminium stocks in warehouses AL-STX-SGH monitored by the Shanghai Futures Exchange, at a record 741,324 tonnes, suggest surpluses in China, the world’s largest producer and consumer of the metal.

* DOLLAR DOWN: The U.S. dollar fell to a 3-1/2 week low against a basket of currencies on Wednesday as traders bet more major central banks will begin reducing monetary stimulus in 2018 because of faster global economic growth.

* OTHER METALS: The remainder of active ShFE base metals contracts were firmer, led by aluminium and lead , each up more than 1 percent. The exception was tin, which was off 0.11 percent

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MARKETS NEWS

* Asian shares rose to a one-month high on Thursday and were on track for their best annual performance since 2009, while commodity-driven currencies were buoyed by a rally in copper, which hit a four-year peak.

DATA/EVENTS 1330 U.S. Weekly jobless claims 1445 U.S. Chicago purchasing management index Dec

PRICES

Three month LME copper

Most active ShFE copper

Three month LME aluminium

Most active ShFE aluminium

Three month LME zinc

Most active ShFE zinc

Three month LME lead

Most active ShFE lead

Three month LME nickel

Most active ShFE nickel

Three month LME tin

Most active ShFE tin

ARBS ($1 = 6.5560 Chinese yuan renminbi)

Reporting by James Regan; Editing by Michael Perry

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