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METALS-Copper prices inch up, extend gains on strong China GDP

SYDNEY, July 18 (Reuters) - Copper prices edged up in early Asian trading on Tuesday, extending gains in the wake of strong Chinese economic data that boosted the outlook for metals demand.

China's economy expanded at a faster-than-expected 6.9 percent clip in the second quarter, setting the country on course to comfortably meet its 2017 growth target, data released on Monday showed.

"Sentiment continues to improve in the industrial metals complex after strong economic data from China yesterday," ANZ said in a note.

"This data appeared to boost confidence in the countrys ability to weather the regulatory reforms that are appearing to tighten monetary conditions in China."

FUNDAMENTALS

* LME COPPER: Three-month copper on the London Metal Exchange was trading up 0.2 percent at $6,007 a tonne at 0130 GMT, maintaining gains posted in the previous London session, where the price hit 4-1/2-month highs.

* SHFE COPPER: The most-traded copper contract on the Shanghai Futures Exchange rose 0.78 percent to 47,890 yuan ($7,082) a tonne.

* NORTH KOREA: South Korea on Monday proposed military talks with North Korea, the first formal overture to Pyongyang by the government of President Moon Jae-in, to discuss ways to avoid hostile acts near the heavily militarized border.

* U.S. TRADE: The United States on Monday launched the first salvo in the renegotiation of the 23-year-old North American Free Trade Agreement (NAFTA), saying its top priority for the talks was shrinking the U.S. trade deficit with Canada and Mexico.

* LME METALS: LME Aluminium slipped 0.3 percent to $1,913 a tonne, zinc gained 0.1 percent to $2,818 a tonne , while lead was flat at $2,296.50 a tonne.

SHFE METALS: ShFE aluminum lost 0.35 percent, zinc was up 0.50 percent, while lead was down 0.51 percent.

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MARKETS NEWS

* Asian shares stepped back from more than two-year highs on Tuesday, while the dollar sagged on growing expectations that the Federal Reserve would take a more cautious approach to raising interest rates.

DATA EXPECTED ON JULY 18 (GMT)

1230 U.S. Import, Export prices June

1255 U.S. Redbook weekly

1400 U.S. NAHB Housing Market Indx July

2000 U.S. Overall Net Capital Flow May

PRICES

Three month LME copper

Most active ShFE copper

Three month LME aluminum

Most active ShFE aluminum

Three month LME zinc

Most active ShFE zinc

Three month LME lead

Most active ShFE lead

Three month LME nickel

Most active ShFE nickel

Three month LME tin

Most active ShFE tin

ARBS ($1 = 6.7690 Chinese yuan renminbi) ($1 = 6.7622 Chinese yuan renminbi)

(Reporting by James Regan; Editing by Joseph Radford)