METALS-Copper steadies amid equity rally; inventories in focus

 (Adds Shanghai closing prices, stocks data; updates London
    BEIJING, March 1 (Reuters) - Copper steadied on Friday as
metals tracked a rally in equities, shrugging off earlier losses
after a private survey showed  factory activity in China
remained in contraction.
    Copper is on course to end the week up 0.5 percent as tight
inventories cancel out weak China data. 
    London Metal Exchange stocks are "surprisingly low," and
would usually lead to "incredibly backwardated curves" if the
market was so short of metal, said Guy Wolf, head of global
market analytics at Marex Spectron.
    The premium of cash copper over the three-month LME contract
CMCU0-3 was at $46.50 a tonne on Thursday. 
    "The fact that spreads are not insanely backwardated at
these levels of stocks tells you that there is some metal around
but it isn't necessarily on the LME," Wolf said.
    New LME warehouse rules may have "made it too difficult for
warehouse operators to generate any kind of return on LME
material. I suspect a lot of that is what's going on," he added.
    * COPPER: Three-month LME copper fell as much as 0.7
percent to its lowest since Feb. 21 before recovering to trade
flat at $6,509 a tonne as of 0751 GMT. The most-traded copper
contract on the Shanghai Futures Exchange closed up 0.5
percent to 50,500 yuan ($7,537.65).
    * VEDANTA: Vedanta Ltd told an Indian court it has
been incurring losses of 50 million rupees ($705,656) daily
since the closure of its copper smelter in May.    
    * STOCKS: Available copper stocks in LME-registered
warehouses MCUSTX-TOTAL fell to 21,600 tonnes and are at their
lowest since 2005. ShFE copper stocks CU-STX-SGH rose by 4.2
percent to 227,049 tonnes over the past week, the exchange said
on Friday.    
    * PREMIUMS: China's Yangshan import premium SMM-CUYP-CN
fell to as low as $48 a tonne, the lowest since April 2017,
suggesting weak physical demand.
    * LEAD: Shanghai lead rose as much as 3.2 percent,
the most since Aug. 24, before ending up 2.8 percent at 17,780
yuan, its highest close since Jan. 29, after a big cancellation
in LME lead warrants MPBSTX-TOTAL on Thursday. Lead added 4.3
percent in Shanghai this week, the most since June.
    * OTHER METALS: Nickel, used to make stainless steel, rose
as much as 1.8 percent in London to a three-week high of
$13,290, tracking the surging Chinese ferrous complex. ShFE
nickel hit 104,790 yuan, its highest since October,
while ShFE zinc rose 2.3 percent a one-month high of 22,300 yuan
    * Asian shares rose after index publisher MSCI announced it
would boost the proportion of mainland Chinese shares in its
global benchmarks.    
 BASE METALS PRICES                      0757 GMT
 Three month LME copper                      6507
 Most active ShFE copper                    50510
 Three month LME aluminium                   1908
 Most active ShFE aluminium                 13680
 Three month LME zinc                        2789
 Most active ShFE zinc                      22295
 Three month LME lead                        2155
 Most active ShFE lead                      17765
 Three month LME nickel                     13265
 Most active ShFE nickel                   104700
 Three month LME tin                        21600
 Most active ShFE tin                      150980
 BASE METALS ARBITRAGE                           
 LME/SHFE COPPER             LMESHFCUc3   -214.02
 LME/SHFE ALUMINIUM          LMESHFALc3  -1091.51
 LME/SHFE ZINC               LMESHFZNc3   -110.48
 LME/SHFE LEAD               LMESHFPBc3    320.68
 LME/SHFE NICKEL             LMESHFNIc3    -38.07
($1 = 6.6997 Chinese yuan renminbi)

 (Reporting by Tom Daly; Editing by Rashmi Aich)