METALS-Copper retreats on firm dollar, profit-taking ahead of U.S. data

By Eric Onstad

LONDON, Sept 4 (Reuters) - Copper prices pulled back on Thursday on a firm dollar and as investors locked in profits from a rally to a five-month peak ahead of key U.S. jobs data and amid uncertainty about tariffs.

Three-month copper on the London Metal Exchange CMCU3 slipped 0.8% to $9,897 per metric ton by 1600 GMT, a day after hitting its strongest since March 26 at $10,038.

LME copper has gained 13% so far this year.

"It seems to be simply profit-taking ahead of these economic data prints," said Ole Hansen, head of commodity strategy at Saxo Bank in Copenhagen.

"Also, this $10,000 level seems to be quite a firm barrier for the copper price for now and the underlying fundamentals are not yet strong enough for it to be able to punch through."

The crucial non-farm jobs report on Friday will help set expectations for the central bank's next few policy meetings.

The most-traded copper contract on the Shanghai Futures Exchange SCFcv1 shed 0.5% to 79,770 yuan ($11,152.12) a ton.

Also weighing on metals markets was a steady dollar index =USD, making commodities priced in the U.S. currency more expensive for buyers using other currencies.

U.S. Comex copper futures HGc3 dropped 1.1% to $4.53 a lb, bringing the premium of Comex over LME copper to $82 a ton.

Uncertainty about demand in top metals consumer China was also unsettling markets.

Marginal weakness in terminal demand may reflect a lackluster peak season in China, though the widespread shutdown of scrap copper rod mills helped lend strength to copper prices, said broker Galaxy Futures.

LME zinc CMZN3 shed 0.9% to $2,836 a ton, as investors have largely shrugged off low inventories of the metal mainly used in galvanizing steel.

LME zinc stocks MZNSTX-TOTAL have slid 76% so far this year.

"For us, the most important zinc demand/price driver in play is abating global steel industry activity, particularly in China," Tom Price, head of commodities strategy at Panmure Liberum, said in a note.

Among other metals, aluminium CMAL3 lost 1.1% to $2,591 a ton, lead CMPB3 lost 0.5% to $1,986, nickel CMNI3 dropped 0.7% to $15,205 and tin CMSN3 eased 0.6% to $34,465.

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($1 = 7.1529 Chinese yuan)

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