METALS-Copper falls after Iran denies talks with US

March 24 (Reuters) - London copper slipped on Tuesday, giving back part of the previous session’s relief rally, after oil rebounded on news that Iran denied any talks with the U.S. to bring the Middle East war to a close.

The benchmark three-month copper contract CMCU3 on the London Metal Exchange fell 1.11% to $12,031.50 a metric ton by 0330 GMT.

On Monday, the contract rose nearly 2% after U.S. President Donald Trump's comments on “very good and productive” negotiations and the postponement of his threatened strikes on Iranian energy infrastructure by five days.

Following Iran's denial, Brent futures LCOc1 rose above $100 per barrel on Tuesday.

The rebound in energy prices, together with firmer U.S. yields and a stronger dollar, added to pressure on industrial metals by raising fears that central banks will have less room to cut rates and that higher fuel costs will sap global growth.

The most-active copper contract SCFcv1 on the Shanghai Futures Exchange, however, rose 1.26% to 94,040 yuan ($13,647.58) a ton.

Traders said sentiment in China remained supported by Trump’s decision to delay the strikes and by hopes of improving demand in the top consumer.

Citi has become more cautious about the outlook for industrial metals as the Middle East conflict clouds the macroeconomic backdrop. Analysts there now expect copper to fall to $11,000 a ton in the next three months, compared with $14,000 previously.

“We expect industrial metals to grind lower while the Hormuz Strait remains closed, as investors discount Fed rate cuts and cyclical growth expectations and continue broad de-risking across risk assets,” they said.

Among other SHFE metals, aluminium SAFcv1 rose 0.47%, zinc SZNcv1 gained 0.81%, lead SPBcv1 0.46%, tin SSNcv1 climbed 1.30%, and nickel SNIcv1 dropped 0.66%.

Elsewhere on LME, aluminium CMAL3 nudged 0.17% higher, zinc CMZN3 dipped 0.15%, lead CMPB3 dropped 0.24%, nickel CMNI3 lost 1.15% and tin CMSN3 slipped 1.01%.

Tuesday, March 24

DATA/EVENTS (GMT)

0815 France HCOB Mfg, Services, Composite Flash PMI Mar

0830 Germany HCOB Mfg, Services, Composite Flash PMI Mar

0900 EU HCOB Mfg, Services, Composite Flash PMI Mar

0930 UK Flash Manufacturing, Services, Composite PMI Mar

1345 US S&P Global Mfg, Scvs, Comp PMI Mar

($1 = 6.8906 Chinese yuan renminbi)