METALS-Copper rebounds on softer dollar, Middle East de-escalation hopes

BEIJING, March 25 (Reuters) - Copper prices rebounded on Wednesday, as a softer dollar and renewed hopes of a de-escalation in the Middle East war bolstered demand prospects.

The most-traded copper contract on the Shanghai Futures Exchange SCFcv1 snapped a two-session losing streak to end daytime trade up 1.14% at 95,590 yuan ($13,864.67) per metric ton.

Benchmark three-month copper CMCU3 on the London Metal Exchange climbed 1.19% to $12,244.5 per ton as of 0722 GMT.

Copper prices in both Shanghai and London lost ground on Tuesday as elevated energy prices amid a prolonged Iran war intensified concerns over inflation and the global economic growth outlook.

Market sentiment broadly improved on Wednesday after U.S. President Donald Trump said that the U.S. was making progress in its efforts to negotiate an end to the war with Iran, including winning an important concession from Tehran, but without offering details. However, Iran has rejected Trump's comments, saying the U.S. was negotiating with itself.

"The expectation of a de-escalation between the U.S. and Iran has become a key force behind improved market sentiment," analysts at broker Everbright Futures said in a note.

"It highlights the market's vulnerability to geopolitical changes, but uncertainties are still there regarding the U.S.-Iran negotiations."

A softer greenback .DXY, =USD, which makes dollar-priced commodities cheaper for buyers using other currencies, also lent support to the base metals complex.

SHFE aluminium SAFcv1 added 0.63%, nickel SNIcv1 gained 1.08%, lead SPBcv1 advanced 0.3%, tin SSNcv1 climbed 1.91% while zinc SZNcv1 edged down 0.28%.

Among other LME metals, nickel CMNI3 rose 2.06%, lead CMPB3 gained 0.5%, tin CMSN3 added 0.64%, zinc CMZN3 advanced 0.74%, while aluminium CMAL3 eased 0.41%.

($1 = 6.8945 Chinese yuan)