METALS-Zinc, copper rebound on bargain hunting and Chinese data

* LME/ShFE arb: http://tmsnrt.rs/2oQ5nm20 (Adds comment on copper, updates prices)

LONDON, Sept 11 (Reuters) - Zinc and other base metal prices rebounded on Monday as investors and consumers took advantage of a sell-off on Friday to buy at lower levels, with strong economic data from top metals consumer China also supporting the market.

Analysts warned, however, that prices still have the potential for a deeper correction after the LME metals index rallied 21 percent between early June and early September.

"I think it's mainly bargain hunting after that fairly savage sell-off we had on Friday but the market's still nervous," said Robin Bhar, head of metals research at Societe Generale in London.

"We've come up so much and seem to overrun the fundamentals that a period of consolidation or correction would seem to be overdue now."

Bhar said he expected a correction of 5 to 10 percent from recent peaks in the coming weeks or months.

Helping to support metals was data at the weekend showing China's producer price inflation accelerated more than expected to a four-month high in August, pointing to strong, sustained growth for both factory profits and the economy.

Financial markets were also relieved that North Korea did not conduct another missile test at the weekend.

* ZINC - Benchmark zinc on the London Metal Exchange had gained 1.4 percent to $3,072 a tonne by 1350 GMT after sliding 3.1 percent on Friday.

* IRMA - Zinc also got support from the high winds and storm surges battering the southern United States. Investors worried about possible damage to metal stored in New Orleans, the location that holds 95 percent of zinc in LME warehouses.

"Front-end spreads have seen bids with the vast majority of LME on-warrant material left sitting in New Orleans, so resultant short fears around hurricane damage," Alastair Munro at broker Marex Spectron said in a note.

* COPPER: LME three-month copper rose 0.7 percent to $6,741 a tonne following a 3 percent fall on Friday.

The copper market has been defying fundamentals, JP Morgan analyst Natasha Kaneva said in a note, forecasting prices to fall to $5,600 in the fourth quarter. "Cathode markets remain well-supplied with spot quotes in Europe and U.S. largely unchanged, and lower in China. This is despite solid regional demand."

* LEAD: LME lead rose 0.3 percent to $2,272 a tonne, with prices supported by news that Chinese lead producer Haicheng Chengxin Nonferrous Metal Co suspended production after an equipment failure at its 100,000 tonne per year smelter.

* LEAD STOCKS: On-warrant LME inventories, those not earmarked for delivery, jumped 11 percent on Monday. <MPBSTX-TOTAL>

* NICKEL: The metal mostly used in stainless steel bounced 1.2 percent to $11,715 after sliding 4.7 percent on Friday.

* PRICES: Aluminium rose 0.9 percent to $2,118 while tin added 0.5 percent to $20,650.

(Additional reporting by James Regan in Sydney and Tom Daly in Beijing; Editing by David Clarke, Greg Mahlich)