* GRAPHIC-2019 asset returns: tmsnrt.rs/2jvdmXl
* Premium for cash zinc over 3-month hits 3-month high (Updates prices)
By Pratima Desai
LONDON, Sept 30 (Reuters) - Copper slipped on Monday as worries about weak demand due to the prolonged U.S.-China trade war weighed on sentiment, but above-consensus industrial activity data from top consumer China provided price support.
Benchmark copper on the London Metal Exchange ended down 0.7% at $5,725 a tonne. Prices of the metal widely used as a gauge of economic health are down more than 4% this quarter and on course for their second quarterly loss.
"The market is waiting for trade talks. We don't expect much activity before then due to celebrations in China (to mark 70 years of Communist Party rule)", said Commerzbank analyst Daniel Briesemann. "The surprisingly positive China PMI data is giving some support to prices of copper and other metals."
Funds and traders squaring positions for end of quarter book keeping were behind price moves in the afternoon session.
PMIs: The Caixin/Markit Manufacturing Purchasing Managers' Index (PMI) for September rose to 51.4 from 50.4 in August. The consensus was for a dip to 50.2.
Another official survey showed factory activity picked up in September on improving domestic demand, despite shrinking for the fifth straight month as new export orders continued to fall.
The official PMI was at 49.8 in September, slightly higher than 49.5 in August.
CHINA: China accounts for nearly half of global copper demand, estimated at 24 million tonnes this year.
TRADE: China hopes Beijing and Washington will resolve their trade dispute "with a calm and rational attitude", Vice Commerce Minister Wang Shouwen said on Sunday, ahead of talks expected in Washington on Oct. 10-11. STIMULUS: China plans to step up economic adjustments to counter its slowing economy while providing adequate liquidity in the economy, the central bank said on Sunday.
HOLIDAY: The Shanghai Futures Exchange (ShFE) will be closed during Oct. 1-7 for the National Day holiday.
ZINC: The premium for the cash over the three-month contract soared to a three-month high of $50 a tonne MZN0-3 due to worries about supplies on the LME market.
These worries have been fuelled by one company holding large amounts of cash contracts, and stocks in LME warehouses near historical lows at 67,300 tonnes MZNSTX-TOTAL.
Three-month zinc was up 3.1% at $2,376 a tonne. It is on course for gains of more than 7% in September, the first monthly gain since March.
LEAD: Prices ended up 3.2% to $2,135. Earlier it touched a seven-month high of $2,151.50 a tonne on worries about shortages over the winter months when demand from the auto battery sector is strong.
PRICES: Aluminium traded down 0.8% at $1,721.5, tin slipped 1.4% to $15,925 and nickel fell 0.9% to $17,050 a tonne. (Reporting by Pratima Desai; additional reporting by Mai Nguyen; editing by Jan Harvey and Ed Osmond)