METALS-Copper set for monthly gains, but weak China demand limits rise

(Updates prices) BEIJING, May 31 (Reuters) - London copper prices rebounded on Friday after previous sell-offs, while the market was set for a moderate monthly rise as physical demand weakness in China remained an overhang. Three-month copper on the London Metal Exchange CMCU3 added 0.5% at $10,187 per metric ton by 0712 GMT. For the month, it has risen 1.9% so far and is up 19% this year. The most-traded July copper contract on the Shanghai Futures Exchange SCFcv1 fell 1.6% to 82,500 yuan ($11,388.89) a ton. China's manufacturing activity unexpectedly fell in May, an official factory survey showed. The official purchasing managers' index (PMI) fell to 49.5 in May from 50.4 in April, below the 50-mark separating growth from contraction. and missing a median forecast of 50.4 in a Reuters poll. That weighed further on demand outlook in the world's top metals consumer, where consumption has already slumped due to recent price rally. A speculative frenzy into copper boosted prices to record highs on May 20, before trending down amid profit taking and worries over U.S. interest rates. Investors are awaiting inflation reports from Europe and the U.S. due later in the day for more clues on monetary policy. Copper may break back below $10,000 per ton as profit taking accelerated, ANZ research analysts noted. However, some other analysts believe the metal is set for further increases given a widening supply deficit of raw material and rising demand. LME aluminium CMAL3 steadied at $2,706.50 a ton, nickel CMNI3 added 1% to $20,260, tin CMSN3 moved 0.7% higher to $33,355, and lead CMPB3 moved 0.6% higher to $2,291, while zinc CMZN3 slid 0.2% at $3,065.50. SHFE aluminium SCFcv1 fell 0.9% to 21,535 yuan a ton, tin SSNcv1 was down 1.4% at 274,950 yuan, nickel SNIcv1 lost 1.3% to 151,650 yuan, zinc SZNcv1 lost 0.8% to 24,890 yuan and lead SPBcv1 was 0.3% lower to 18,840 yuan. For the top stories in metals and other news, click TOP/MTL or MET/L ($1 = 7.2439 Chinese yuan renminbi) (Reporting by Siyi Liu and Colleen Howe; Editing by Rashmi Aich and Varun H K) (([email protected];)) ((For related news and prices, click on the codes in brackets: LME price overview RING= COMEX copper futures 0#HG: All metals news MTL All commodities news C Foreign exchange rates FX= SPEED GUIDES LME/INDEX ))