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METALS-Nickel leads most Chinese metals higher

SYDNEY, Aug 29 (Reuters) - Chinese nickel futures led most base metals higher on Tuesday, helped by a resurgent market for steel.

Nickel, chiefly used in making stainless steel, has been on a tear, rising 27 percent in price since early July on the Shanghai Futures Exchange.

"Nickel has supply issues that are still playing out and that's helping, particularly when we see steel prices going up too," said a commodities trader in Sydney.

FUNDAMENTALS

* Three-month nickel on the London Metal Exchange was up 3 percent at $11,840 a tonne by 0100 GMT, the highest price since Nov. 28, 2016, according to Thomson Reuters data.

* The most-traded nickel contract on the Shanghai Futures Exchange gained just over 2 percent at the open to 93,490 yuan ($14,147.15) a tonne.

* LME RESUMES: LME trading resumes on Tuesday following a holiday in Britain on Monday.

* ZINC RISES: ShFE zinc contract reversed the previous day's loss and was up 0.6 percent, also aided by optimism in steel markets. Zinc is needed in steel galvanizing. However, lead, also found in steel, failed to find support, dipping 0.5 percent.

* FRESH COPPER PEAK: Three-month LME copper was trading 2 percent higher at a fresh 34-month peak of $6,791 a tonne, amid signs of declining spare metal in warehouses.

COPPER INVENTORIES: weekly copper stocks in warehouses registered by the Shanghai Futures Exchange declined by 8.2 percent to 187,444 tonnes CU-STX-SGH. Meanwhile, on-warrant inventories - those not earmarked for removal - in LME depots have halved to 112,950 tonnes over the past six weeks MCUSTX-TOTAL, data last week showed.

* SHFE COPPER: ShFE copper gained 0.7 percent.

* TRUMP DECLINES CHINA PROPOSAL: U.S. President Donald Trump last month rejected a Chinese proposal to cut steel overcapacity, despite the endorsement of some of his top advisers, the Financial Times said, citing people familiar with the matter.

* CHINA STEEL UP: the most-active rebar futures on the Shanghai Futures Exchange was trading 1 percent higher.

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MARKETS NEWS

* U.S. stock futures and Asian share markets tumbled on Tuesday, while the yen jumped to four-month highs against the dollar after North Korea fired a missile over northern Japan, setting up a tense start to trading for markets in the region.

DATA/EVENTS

1255 U.S. Redbook weekly 1400 U.S. Consumer Confidence Aug 1430 U.S. Texas Serv Sect Outlook Aug

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 = 6.6084 Chinese yuan)

(Reporting by James Regan; Editing by Jacqueline Wong)