METALS-Copper rises as better than expected US retail sales lift sentiment

By Polina Devitt

LONDON, July 17 (Reuters) - Copper prices rose on Thursday as better than expected U.S. retail sales outweighed rising copper stocks and uncertainty about the U.S. import tariff.

Three-month copper CMCU3 on the London Metal Exchange added 0.3% to $9,665.50 a metric ton by 1623 GMT.

U.S. retail sales rebounded more than expected in June, suggesting the U.S. economy was regaining momentum, improving sentiment on copper, which is widely used in power and construction.

Meanwhile, some copper previously planned for the U.S. has returned to the LME system MCUSTX-TOTAL after Washington said last week that it would impose a 50% import tariff on copper from August 1.

"LME copper stocks continue to rise as material is rerouted back to the exchange, with the window to ship in time to meet COMEX tariff deadlines quickly closing," said analysts at broker Sucden Financial.

Available, or on-warrant, LME copper stocks have climbed by 70% to 110,950 tons - the highest since April 30 - since Washington announced its copper tariff plan, easing concerns about near-term availability of the metal.

This can be seen in the spread between the cash copper contract and the three-month forward CMCU0-3 swinging to a discount. The discount was last at $53 a ton, compared with a premium of $320 three weeks ago.

A lot of uncertainty remains over the U.S. tariffs, with the market waiting for confirmation of the August 1 deadline and a list of the copper products to which the levy would apply. There has also been much speculation about possible exemptions for major copper-producing countries.

Adding further pressure on copper, Chinese data on Wednesday showed that the country's refined copper output in June rose 14% year on year to a record high.

In other metals, aluminium CMAL3 was up 0.2% at $2,582 a ton, zinc CMZN3 added 1% to $2,737, lead CNPB3 lost 0.1% to $1,975, tin CMSN3 gained 0.8% to $33,040 and nickel CMNI3 was up 0.6% at $15,105.

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