METALS-Shanghai copper firm, LME eyes best week since March

* Trading rangebound but hopes for global recovery persist * LME copper eases after steep gains in the week * China aluminium output above 1 mln tonnes in June * Shanghai copper stocks drop, LME inventory rises (Adds LME, Shanghai warehouse stocks) By Manolo Serapio Jr. MANILA, July 17 (Reuters) - Shanghai copper edged up for afourth day running on Friday and posted its biggest weekly gainin more than a month, supported by signs the global economy hadbottomed out. Data released on Thursday showed China's annual grossdomestic product growth quickened to a stronger-than-forecast7.9 percent in the second quarter, making it thebest-performing major economy and reinforcing hopes the worldeconomy is pulling out of its deepest recession in 80 years. [ID:nSP537798] Shanghai's third month copper contract SCFc3 closed up0.5 percent at 41,750 yuan ($6,113) a tonne, and rose 5.7percent on the week. The contract hit a nine-month peak of42,290 yuan a tonne on Thursday, aided by the Chinese data. "We are getting into recovery position, all leadingindicators are getting better and some of the European and U.S. data are also suggesting that things have already bottomedout," said Bonnie Liu at Macquarie. "It's only a matter of time before people see a realpick-up of the global economy. Three-month copper on the London Metal Exchange MCU3 fell$30 to $5,230 a tonne by 0701 GMT, but is on course for a gainof more than 7 percent in its strongest weekly showing sinceearly March. "At the moment, I think the movement in copper prices isreally modest and still within the sort of ranges we've seen inrecent days, so I wouldn't read too much into it," said DavidMoore, commodity strategist at Commonwealth Bank of Australia. There was more mixed news on the U.S. economy on Thursdaywith the number of Americans filing for jobless benefits lastweek falling to the lowest level since January, while a keyregional manufacturing index slipped more than expected inJuly. [ID:nN16398331] Investors also remain concerned about the tightness in thecopper market, with data showing a dominant positioncontrolling between 50 percent and 80 percent of LME copperstocks. Traders said this was behind copper flipping intobackwardation earlier this week -- the first time since May --with the premium for LME cash copper over the three-monthcontract at $7/$14 on Friday. In Shanghai, copper stocks in warehouses monitored by thefutures exchange dropped a modest 884 tonnes from the previousweek to 53,283 tonnes, compared with a fall of more than 5,800tonnes a week earlier. Inventory of the industrial metal in LME warehouses rose3,275 tonnes to 264,150 tonnes on Friday. For graphics on global stocks of copper, aluminium andzinc, click: here here here Elsewhere, LME aluminium MAL3 dropped $4.75 to $1,685.30 atonne, after hitting a session-high of $1,699, its best levelsince early June, even as a record-level inventory of thelightweight metal at above 4.5 million tonnes continued toworry investors. Boosting supply further, production of primary aluminium inChina topped 1 million tonnes for the first time this year inJune due to high prices and local governments encouragingsmelters to bring new and idled capacity online. [ID:nHKG323853] Base metals prices at 0702 GMT Metal Last Change Pct Move End 2008 Pct chg 09 LME Cu 5220.00 -40.00 -0.76 3060.00 70.59 SHFE Cu* 41750.00 210.00 +0.51 23840.00 75.13 LME Alum 1680.00 -10.00 -0.59 1535.00 9.45 SHFE Alum* 13645.00 130.00 +0.96 11540.00 18.24 COMEX Cu** 238.10 0.10 +0.04 139.50 70.68 LME Zinc 1540.00 -9.00 -0.58 1208.00 27.48 SHFE Zinc 13420.00 180.00 +1.36 10120.00 32.61 LME Nickel 16000.00 -100.00 -0.62 11700.00 36.75 LME Lead 1625.00 5.00 +0.31 999.00 62.66 LME Tin 12975.00 -50.00 -0.38 10700.00 21.26 LME/Shanghai arb^ -26 Dollar/yuan 6.8317 6.8337 ** 1st contract month for COMEX copper * 3rd contact month for SHFE aluminium, copper and zinc ^ LME 3-m copper in yuan, including 17 pct VAT, minus SHFE third month (Editing by Ben Tan)