(Adds zinc high, comments, details) MELBOURNE, Aug 16 (Reuters) - London zinc hit its highest in almost a decade on Wednesday, as Chinese infrastructure demand that has fed a rally in steel prices for months spills into markets for steelmaking raw materials. The rally in zinc, used for galvanising steel, comes as China steps up plans to develop infrastructure while capacity cuts in its steel industry reform boost prices, said analyst Daniel Hynes of ANZ in Sydney. "There (was) a fair level of scepticism at the start of the year when China's infrastructure projects were announced but we're seeing much better-than-expected growth in fixed asset investment," said Hynes. "That resetting of expectations is resulting in that much more positivity to the sector."
* LME ZINC: London Metal Exchange zinc peaked at $2,990 a tonne, having cracked its Nov. 2016 high to take prices back to their most expensive since Oct. 2007.
* CHINA GROWTH: China's strong economic growth showed visible signs of fading in July as lending costs rose and the gravity-defying property market cooled, though activity levels generally remained solid, propped up by a year-long construction spree.
* FIXED ASSET: Fixed-asset investment still grew 8.3 percent in the first seven months of the year, even as it slowed from 8.6 percent in the first half.
* STEEL: Gains came even as Chinese steel and iron ore futures slipped for a fourth session as recent moves by the Shanghai exchange to increase trading charges kept the two commodities under pressure.
* LME ALUMINIUM: LME aluminium hit its highest since November, 2014 at $2,065.50 a tonne, as Chinese capacity cuts extend to the sector in Beijing's drive to clean up its skies ahead of the winter heating season. A break above $2,078.75 would open the way to prices last seen in September 2014.
* HONGQIAO: The world's top aluminium maker, China Hongqiao Group clarified in a notice to the Hong Kong Exchange that it has shut down 2.68 million tonnes of production capacity amid the country's supply-side reforms, representing 29 percent of group's total production capacity of aluminium products.
* COPPER: LME copper was flat at $6,379 a tonne, having closed a tad softer and still below its most recent 2-1/2 year top of $6,515.
* SHANGHAI: On the Shanghai Futures Exchange, copper was little changed, but zinc and aluminium were traded up around 2 percent.
* M&A: Mergers and acquisitions by Chinese companies in countries that are part of the Belt and Road initiative are soaring, even as Beijing cracks down on China's acquisitive conglomerates to restrict capital outflows.
* COMING UP: U.S. Housing starts, building permits for July at 1230 GMT
Three month LME copper 6380.5 Most active ShFE copper 50150 Three month LME 2065
Most active ShFE 16090
Three month LME zinc 2984 Most active ShFE zinc 24660 Three month LME lead 2396.5 Most active ShFE lead 19390 Three month LME nickel 10390 Most active ShFE nickel 85060 Three month LME tin 19940 Most active ShFE tin 143020 LME/SHFE COPPER LMESHFCUc3 416.89 LME/SHFE ALUMINIUM LMESHFALc3 68.28 LME/SHFE ZINC LMESHFZNc3 795.06 LME/SHFE LEAD LMESHFPBc3 29.49 LME/SHFE NICKEL LMESHFNIc3 2319.1
(Reporting by Melanie Burton; Editing by Joseph Radford and Kenneth Maxwell)