METALS-Copper ends lower, aluminium hits 4-week high

MARKETS-METALS (UPDATE 7):METALS-Copper ends lower, aluminium hits 4-week high. * Aluminum hits 4-week high as demand improves * U.S. housing data fails to provide boost * Copper weighed by climbing LME inventories (Recasts, updates prices, market activity to New York copper close; adds second byline, dateline, previously LONDON) By Chris Kelly and Humeyra Pamuk NEW YORK/LONDON (Reuters) - Copper prices ended with modest losses Thursday, as worries that Chinese imports could slow and supplies could pile up in LME warehouses outweighed positive U.S. economic data. Aluminum rose to a four-week high, buoyed by signs of improving demand, while nickel, zinc and tin edged higher and lead finished slightly down. Steve Platt, futures analyst with Archer Financial Services in Chicago, said the copper market remained concerned about the housing sector despite data showing new construction of U.S. homes and future building permits up at nine-month highs in August. "I don't think anyone is really expecting a big recovery in the housing sector until we can get through some of these foreclosures next year," he said. "That seems to be weighing on values and kind of containing the market on the upside." Copper for December delivery on the New York Mercantile Exchange's COMEX division ended down 4.05 cents at $2.8960 a lb, after dealing in a session range from $2.8870 to $2.9550. On the London Metal Exchange, copper for three months delivery closed down $30 at $6,385 a tonne. "Some of the metals like copper are experiencing increases in LME inventories and I think the market is taking that as a signal that the expected recovery in OECD demand hasn't got underway yet," Barclays ( BCS - news - people ) Capital analyst Gayle Berry said. "There is plenty of scepticism out there about whether an OECD demand recovery does transpire over the rest of the year and I think there are some concerns over the strength of Chinese import demand as well," she added. Copper prices have more than doubled so far this year amid speculative buying, signs of improvement in the global economy and Chinese restocking, which has run out of steam. This week's strong U.S. retail data and comments from Federal Reserve Chairman Ben Bernanke saying the U.S. recession is probably over buoyed copper, but not enough to lift it from the $500 trading range in which it has been stuck since early August. INVENTORIES Inventory data has fed caution. LME copper inventories rose 1,150 tonnes on Thursday to 324,375 tonnes, up by over a quarter since July. Early expectations were for weekly Shanghai copper stocks to be flat to slightly lower when data is released on Friday. Aluminum rose $40 to end at $1,967. Earlier prices rallied to $1,978, their highest since Aug. 20. Berry said aluminum was boosted by talk of improving demand in Brazil, China, the U.S. and Europe, while noting there was "a lot of scepticism about whether it will continue." Traders also said aluminum premiums were up on the back of speculation Russian aluminum giant RUSAL has agreed to sell another 500,000 tonnes of the metal to Swiss trading house Glencore. Zinc rose to $1,958.5 per tonne, versus $1,937. Nickel climbed to $17,575 from $17,250, while battery making material lead was slightly down at $2,276 versus $2,294 a tonne. Tin edged up to $14,800 a tonne from $14,600. (Additional reporting by Nick Trevethan in Singapore and Nigel Hunt in London; Editing by David Gregorio)