* Copper gains buck dollar strength
* U.S. retail sales data provides economic boost
* Coming up: U.S. October producer prices on Tuesday (Recasts with New York closing copper price, adds New York dateline/byline, graphic and analyst comments)
By Chris Kelly and Pratima Desai
NEW YORK/LONDON, Nov 15 (Reuters) - Copper resisted a bearish trend across the base metals complex on Monday, ending higher on the back of strong retail sales data in the United States that pointed to brighter economic prospects in the world's largest economy.
Lingering concerns about potential further monetary policy tightening in top metals-consumer China weighed heavily on the complex at the start of trade, dragging zinc CMZN3, nickel CMNI3 and aluminum CMAL3 to multiweek lows and copper to its lowest levels in more than a week.
But red metal prices moved back into positive territory later in the day, even as the dollar held firm, with upbeat U.S. data leading some economically optimistic buyers back into the market, analysts said.
"A lot of the commodities are up today even though the dollar is strengthening again," said Donald Selkin, chief market strategist with National Securities Corp in New York.
"I think that they are beginning to separate themselves a little bit."
Indeed, copper's negative correlation with the dollar has been weakening since the start of the month.
(Graphic: link.reuters.com/qaq55q )
Benchmark copper CMCU3 on the London Metal Exchange fell to $8,460 a tonne, its lowest since Nov. 4, before ending up $30 at $8,645 a tonne.
At the COMEX metals division of the New York Mercantile Exchange, copper for December delivery HGZ0 followed a similar pattern. It fell to its lowest in more than one week at $3.8495 per lb, before recovering to settle up 3.15 cents at $3.9250 a lb.
Bullish participants cheered data on Monday showing sales at U.S. retailers rose more than expected in October to post their largest gain in seven months. [ID:nLDE6AE1RH]
"The retail sales number showed a little bit of strength and optimism about the economy," Selkin said.
The U.S. data helped ease some market jitters about monetary tightening in China after data last week showed inflation in the metals giant rose to a 25-month high in October and bank lending was above expectations. [ID:nN15239736] [ID:nTOE6AA03C]
The dollar rose to a six-week high against major currencies on Monday, buoyed by a rise in U.S. Treasury yields that heightened the appeal of U.S. assets, while the euro came under pressure as Ireland's debt problems shook confidence in the euro zone. [USD/]
The combination of recent positive U.S. macro data, fund buying, dollar weakness and worries about inflation helped drive copper to a record high of $8,966 a tonne last week.
A supportive fundamental backdrop added to the upside momentum.
LME copper stocks fell by 75 tonnes to 362,700 tonnes on Monday. Stockpiles are down more than 30 percent since hitting a 6-1/2 year high of 555,075 tonnes in the middle of February and are at their lowest levels in more than a year. <0#LME-STOCKS>
Market players continued to monitor a workers' strike at the world's No. 3 copper mine, Chile's Collahuasi, which entered its 11th day on Monday. The deposit operator said output is normal and the union is vowing a long stoppage. [ID:nN15234973]
Concern about supplies in the near term have pushed the metal into a $21.5 a tonne backwardation -- premium for cash material over the three-month contract MCU0-3 -- compared with a discount of $20 a tonne at the end of October.
"You don't like to sell copper when there is a strike on and the market is so tight -- we've been saying sell zinc when you think things have done enough. Sell zinc, nickel and lead," said David Thurtell, analyst at Citi.
In other metals, lead CMPB3 touched a two-week low of $2,412 a tonne before ending down $65 at $2,455.
Steel ingredients were weak with zinc CMZN3 falling to $2,264.75 a tonne, its lowest since Oct. 8, and nickel CMNI3 sliding to $21,980 a tonne, its lowest since Sept. 8.
Zinc ended down $56 at $2,338 and nickel shed $35 to end at $22,350 a tonne.
Tin CMSN3 fell to its lowest in two weeks at $25,180 a tonne, before ending down $1,100 at $25,900 a tonne.
Aluminum CMAL3 eased $4 to close at $2,400 a tonne, recovering from an earlier two-week low of $2,354 a tonne. Metal Prices at 1942 GMT COMEX copper in cents/lb, LME prices in $/T and SHFE prices in yuan/T Metal Last Change Pct Move End 2009 Ytd Pct
move COMEX Cu 391.20 1.85 +0.48 334.65 16.90 LME Alum 2399.00 -5.00 -0.21 2230.00 7.58 LME Cu 8644.00 29.00 +0.34 7375.00 17.21 LME Lead 2454.00 -66.00 -2.62 2432.00 0.90 LME Nickel 22350.00 -350.00 -1.54 18525.00 20.65 LME Tin 25895.00 -1105.00 -4.09 16950.00 52.77 LME Zinc 2338.00 -56.00 -2.34 2560.00 -8.67 SHFE Alu 16795.00 105.00 +0.63 17160.00 -2.13 SHFE Cu* 64930.00 -710.00 -1.08 59900.00 8.40 SHFE Zin 18705.00 -1230.00 -6.17 21195.00 -11.75 ** Benchmark month for COMEX copper * 3rd contract month for SHFE AL, CU and ZN SHFE ZN began trading on 26/3/07 (Additional reporting by Michael Taylor in London; editing by Keiron Henderson and Jim Marshall)