Copper extends decline from record high as investors shift to risk-off positioning

Feb 2 (Reuters) - Copper continued to pull back on Monday for a second straight session as investors moved into risk-off mode after Kevin Warsh's nomination as the next Fed chair, while demand was also subdued in the run up to China's Lunar New Year break.

The most-active copper contract on the Shanghai Futures Exchange SCFcv1 slumped 7.60% to 100,110 yuan ($14,401.00) a metric ton as of 0330 GMT.

The benchmark three-month copper on the London Metal Exchange CMCU3 dropped 2.73% to $12,798 a ton.

Copper is taking hits after it set record highs on both exchanges on Thursday, touching 114,160 yuan in Shanghai and $14,527.50 in London, supported by a speculative buying spree.

The decline is part of a broader sell-off in metals led by gold XAU= and silver XAG= as investors unwind a record-setting speculative rally after U.S. President Donald Trump on Friday nominated Kevin Warsh as the next Chair of the Federal Reserve, a former Fed governor seen as less likely to press for aggressive rate cuts.

The U.S. dollar =USD has steadied, consolidating gains after strengthening following Warsh's appointment. A higher dollar weakens commodities priced in the greenback, as they become less affordable for investors using other currencies.

Alongside other industrial metals, copper also came under pressure as demand prospects weaken in the run up to the Lunar New Year holiday starting February 15 in top consumer market China.

The Yangshan copper premium SMM-CUYP-CN, a gauge of Chinese consumer's appetite for imported materials, rose to $27 a ton after a decline in copper prices, but is still low compared with above $40 entering January.

Among other base metals, tin led the selloff, with the most-traded contract in Shanghai SSNcv1 hitting its limit down to decline by 11% to 392,650 yuan a ton.

Benchmark London tin SSNcv1 pulled back 6.93% to $48,355 a ton.

Tin's drop is squeezing out earlier bubbles, traders said.

Elsewhere on SHFE, aluminium SAFcv1 tumbled 6.64%, zinc SZNcv1 declined 5.64%, lead SPBcv1 dropped 1.61%, nickel SNIcv1 plunged 8.09%.

Among other LME metals, aluminium CMAL3 dropped 2.40%, zinc CMZN3 was down 2.88%, lead CMPB3 dipped 1.72%, and nickel CMNI3 lost 3.92%.

($1 = 6.9516 Chinese yuan renminbi)