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METALS-Firmer dollar, sell-off in equities push Shanghai copper to 1-month low

(Updates prices)

HANOI, Jan 28 (Reuters) - Shanghai copper prices hit a more than one-month low on Thursday, while other industrial metals also fell, as a global sell-off in equities and a firmer U.S. dollar made greenback-priced metals less appealing to holders of other currencies.

Weaker equities also hurt risk sentiment across assets and raised concerns about liquidity in financial markets.

The most-traded March copper contract on the Shanghai Futures Exchange ended 1.8% lower at 57,760 yuan ($8,910.14) a tonne, after dropping as much as 2% to 57,620 yuan a tonne earlier in the session, a level unseen since Dec. 23.

ShFE nickel closed down 2% to 131,280 yuan a tonne and zinc lost 1.8% at 19,515 yuan a tonne.

Three-month copper on the London Metal Exchange fell 0.61% lower to $7,780 a tonne at 0722 GMT, and nickel fell 1.9% to $17,580 a tonne and tin shed 1% to $22,575 a tonne.

Asian shares slid, while the safe-haven dollar rallied as a sudden sell-off on the Wall Street and delays with coronavirus vaccines shook investor optimism.

“Fundamental is supportive but macro is not,” said analyst He Tianyu of consultancy firm CRU Group, adding that demand for copper in top consumer China ahead of the Lunar New Year holiday has been better than the same period in previous years.

“The Chinese government encourages workers to celebrate the holiday locally. That means working days will be longer than before,” he said.

FUNDAMENTALS

* Yangshan copper premium SMM-CUYP-CN rose to $72 a tonne, its highest since August 2020, SMM data showed.

* LME cash aluminium traded at a $4-a-tonne discount from the three-month contract CMAL0-3, flipping from three days in the premium zone, indicating that nearby supply tightness has eased.

* LME zinc inventories MZNSTX-TOTAL leaped 55% in the previous two sessions to 294,500 tonnes, a level unseen since June 2017.

* LME lead stockpiles MPBSTX-TOTAL fell to their lowest since July 2020 at 107,175 tonnes.

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$1 = 6.4825 yuan Reporting by Mai Nguyen; Editing by Sherry Jacob-Phillips and Rashmi Aich

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