METALS-LME copper hits 6-week high, China data aids
* China industry turns more bullish on 2013 prospects
* Fresh fund momentum seen buoying copper prices
* Coming Up; Euro zone Markit Mfg PMI for Nov; 0858 GMT
(Adds detail, comment, updates prices) SINGAPORE, Dec 3 (Reuters) - London copper rallied to its highest in six weeks on Monday as promising manufacturing data from top consumer China fuelled a cautious return in investors' appetite for the metal, although worries over U.S. fiscal woes kept a lid on gains. The pace of activity in China's vast manufacturing sector quickened for the first time in 13 months in November, a survey of private factory managers found, adding to evidence that the economy is reviving after seven quarters of slowing growth.
"China's economic data is improving into quarter four. That is supporting prices - I don't see much pressure on the downside before the end of the year," said analyst Bonnie Liu of Macquarie. Three-month copper on the London Metal Exchange climbed 0.20 percent to $8,010.00 a tonne by 0308 GMT. Copper prices hit $8,045 a tonne earlier, the highest since Oct. 19 and are expected to extend an advance on chart-based buying after prices last week broke above the 200 day moving average around $7,905. Prices have rallied almost 7 percent from a more than two-month low hit in November. Also boosting metals, the euro rose to a six-week high against the dollar, after China's manufacturing data helped to trigger stop-loss buying of the common currency. A softer dollar spurs buying of commodities priced in the greenback by making them cheaper for holders of other currencies. The most-traded March copper contract on the Shanghai Futures Exchange climbed 0.45 percent to 57,560 yuan ($9,200) a tonne. But continued uncertainty over the U.S. fiscal cliff - $600 billion in government spending reductions and expiring tax cuts set to kick in at the start of next year that threatens to tip the economy back into recession - weighed on investor sentiment. Macquarie's Liu said she expects a resolution to the U.S. fiscal cliff before Christmas which would shake off some uncertainty clouding demand prospects for the metal into 2013. "This week's focus will again be on economic data considering today's release of the US and European manufacturing PMIs, and the US labor report on Friday," Credit Suisse said in a note. "Should the data confirm the recent pick-up in economic momentum, we think commodity prices should recover further." U.S. manufacturing data Monday and a November labour report are expected to show some impact from superstorm Sandy.
CHINA BULLS? Sentiment at last week's Asia Week copper conference in Shanghai suggested China's industry was more upbeat about 2013 prospects, one Shanghai trader said, with confidence seeping back to product makers now the country's once-in-a-decade leadership changeover is underway. Short term, fund money and an improving chart picture have primed the market for a rally, although gains may not prove sustained, he added. "People here all have the feeling that the market is going up, with fund support and fresh money coming in. They see prices peaking before Chinese new year," he said. Copper open interest and prices have been on an uptrend since Nov. 21 <MCU-OI-TOT>, a signal fresh long position holders have entered the market. "Technically, all the metals look pretty good at the moment, having broken out of recent ranges and trading up through major moving averages," RBC Capital said in a note. "While we support higher prices before year end, we are wary of the recent rally as it seems largely driven by technical buying."
PRICES
Base metals prices at 0308 GMT
Metal Last Change Pct Move YTD pct chg LME Cu 8010.00 16.00 +0.20 5.39 SHFE CU FUT MAR3 57560 260 +0.45 3.97 HG COPPER MAR3 365.60 0.60 +0.16 6.40 LME Alum 2091.00 -3.00 -0.14 3.51 SHFE AL FUT FEB3 15470 -25 -0.16 -2.37 LME Zinc 2048.00 1.00 +0.05 11.00 SHFE ZN FUT FEB3 15460 05 +0.03 4.49 LME Nickel 17595.00 -55.00 -0.31 -5.96 LME Lead 2247.00 -5.00 -0.22 10.42 SHFE PB FUT 15480.00 45.00 +0.29 1.28 LME Tin 21918.00 73.00 +0.33 14.16 LME/Shanghai arb^ 863
Shanghai and COMEX contracts show most active months ($1 = 6.2267 Chinese yuan)
(Editing by Himani Sarkar)