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METALS-Shanghai copper drops as China's COVID-19 cases stoke demand fears

HANOI, Jan 12 (Reuters) - Shanghai copper prices on Tuesday hit their lowest in a week, as rising coronavirus cases in China fuelled concerns about disruption in demand in the world’s biggest metals consumer.

The most-traded March copper contract on the Shanghai Futures Exchange fell as much as 2.5% to 57,960 yuan ($8,958.82) a tonne, its lowest since Jan. 5.

ShFE aluminium declined 2.2% to 14,830 yuan a tonne by 0318 GMT, nickel was down 2.2% at 127,180 yuan and zinc shed 1.9% to 20,730 yuan.

China reported 55 new virus infections on Monday, down from 103 the previous day for the biggest daily increase in more than five months, sparking concerns ahead of Lunar New Year holidays in early February that could further cut into demand.

Three-month copper on the London Metal Exchange advanced 0.7% to $7,915 a tonne, while aluminium fell 0.3% to $2,003.50 a tonne, nickel rose 1.3% to $17,310 a tonne and lead advanced 0.6% to $1,979 a tonne.

FUNDAMENTALS

* Copper inventories in LME warehouses MCUSTX-TOTAL rose for the first time since Dec. 4, 2020 to 104,950 tonnes, while the discount of LME cash copper to the three-month contract CMCU0-3 expanded to $14.25 a tonne, its biggest since Jan. 4.

* Rio Tinto-controlled Turquoise Hill Resources said Mongolia’s government is considering terminating the companies’ underground expansion of their Oyu Tolgoi copper mine project due to rising development costs.

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MARKETS NEWS

* Asian stocks were mostly lower, tracking Wall Street declines as political turmoil in Washington and rising coronavirus cases worldwide weighed on sentiment ahead of the start of the quarterly earnings season.

DATA/EVENTS (GMT)

-- Brazil IPCA Inflation Index MM Dec

$1 = 6.4696 yuan Reporting by Mai Nguyen, Editing by Sherry Jacob-Phillips

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