METALS-Copper ends down on disappointing U.S. growth data

* Demand hopes strong following Fed rate announcement
* EU's Rehn says Greek debt talks have nearly concluded
* Copper stocks fall to lowest since Sept 2009

By Maytaal Angel and Silvia Antonioli
LONDON, Jan 27 (Reuters) - Copper closed almost 1 percent lower on
Friday as the dollar rose and risk appetite weakened after U.S. data suggested
that the growth of the world's largest economy could disappoint this year.
Copper still was on track for a third straight week of gains as investors
hoped Greek debt talks would soon conclude and as demand prospects were seen
brighter following the U.S. Federal Reserve's pledge to keep rates low.
Benchmark three-month copper on the London Metal Exchange closed at
$8,530 a tonne, down 0.7 percent from $8,590 at the close on Thursday, having
earlier reached a high of $8,679.50. The metal is headed for a 4 percent
increase this week and an 11 percent jump so far this year, following a 21
percent drop in 2011.
The U.S. economy grew at its fastest pace in 1-1/2 years in the fourth
quarter, but a strong rebuilding of stocks by businesses and weak spending on
capital goods hinted at slower growth in early 2012.
"The data was worse than expected. The U.S. was still growing, but if you
exclude inventories, the real growth was only 0.8 percent," said Andrey
Kryuchenkov, an analyst at VTB Capital.
"At the moment copper is still trading on macro sentiment despite drawdowns
of inventories. We needed to see a correction anyway as the market was
overbought. China is also quiet, and it will take time before the euro zone
problems are resolved, so copper is running out of steam a bit."
The euro reversed early gains against the dollar on Friday after the U.S.
GDP data prompted a run for safe havens. A stronger U.S. currency makes
it costlier for holders of other currencies to buy dollar-denominated
commodities.
The Shanghai Futures Exchange is closed this week for the Lunar New Year
holiday. Sluggish demand from China, as well as a recovery in supplies and an
uncertain economic outlook for the global economy, are set to weigh on copper
this year, a Reuters poll showed.

STIMULUS
Supporting copper this week, Federal Reserve Chairman Ben Bernanke said the
U.S. central bank was ready to offer the economy additional stimulus after it
announced it was likely to keep interest rates near zero until at least late
2014.
Also many investors hoped new developments would help stop the euro zone
debt crisis from spreading.
EU Economic and Monetary Affairs Commissioner Olli Rehn described talks with
private creditors on restructuring Greek debt as "very close" to closing, though
some people were growing jittery that Portugal may require another
bailout.
On the supply side the latest readings pointed to continued tightness in
copper. LME inventories fell by 2,450 tonnes to 335,425, their lowest since
September 2009.

"The outlook for industrial metals is now definitely improving as the
combination of low interest rates and stabilizing economic growth is supportive
for more cyclical sectors," said Credit Suisse in a note.
But it voiced concerns over China, the world's top copper consumer: "Next
week's focus is likely to shift to China. We should get more indications whether
Chinese inventories rose just as a result of restocking ahead of the Chinese New
Year or because of a slowdown in demand."
In other metals, zinc closed at $2,150 from $2,205, aluminium
at $2,265 from $2,276, and nickel at$21,700 a tonne from
$21,600.
Lead ended at $2,295 a tonne versus $2,325, and tin was
$24,400 from $24,005.

Metal Prices at 1719 GMT
Comex copper in cents/lb, LME prices in $/T and SHFE prices in
yuan/T
Metal Last Change Pct Move End 2010 Ytd Pct
move
COMEX Cu 387.50 -2.30 -0.59 444.70 -12.86
LME Alum 2263.75 11.75 +0.52 2470.00 -8.35
LME Cu 8535.25 -54.75 -0.64 9600.00 -11.09
LME Lead 2285.00 -40.00 -1.72 2550.00 -10.39
LME Nickel 21651.00 51.00 +0.24 24750.00 -12.52
LME Tin 24275.00 270.00 +1.12 26900.00 -9.76
LME Zinc 2152.00 -53.00 -2.40 2454.00 -12.31
SHFE Alu 16395.00 30.00 +0.18 16840.00 -2.64
SHFE Cu* 60720.00 160.00 +0.26 71850.00 -15.49
SHFE Zin 15855.00 195.00 +1.25 19475.00 -18.59
** Benchmark month for COMEX copper
* 3rd contract month for SHFE AL, CU and ZN
SHFE ZN began trading on 26/3/07