METALS-China drives copper to fifth quarterly gain in a row

* LME/ShFE arb: http://bit.ly/2wZSAEz (Updates throughout, changes dateline from SINGAPORE)

LONDON, Sept 29 (Reuters) - Copper rose to its highest in more than two weeks on Friday and was set to notch up its fifth consecutive quarterly gain on expectations of strong demand from top metals consumer China.

Three-month copper on the London Metal Exchange was 0.2 percent higher to $6,534 a tonne by 1012 GMT after earlier touching $6,581, its highest since Sept. 13.

"We had that summer drive which saw increased speculative interest in the market and a large part of that is on the back of positive Chinese data," ING commodities strategist Warren Patterson said.

"But in the short term we feel as though the market has done too much too soon and we could see some short-term pull back."

The metal used in power and construction is on track for its longest quarterly winning streak since it rose five quarters in row to the end of the first quarter of 2010.

CHINA DATA: China's factories were expected to have increased activity for the 14th straight month in September as a building boom and higher prices generate hearty profits, though the pace of growth may have eased slightly from August.

TECHNICALS: Next technical resistance is seen at $6,614 per tonne, Alastair Munro at Marex Spectron said, above which opens up a move to $6,700.

SHANGHAI STOCKS: The decline in inventories in warehouses monitored by the Shanghai Futures Exchange <CU-STX-SGH> supported copper prices. They fell 27 percent in the last week, the exchange said on Friday.

LME INVENTORIES: LME stocks shed 1,175 tonnes to 297,250 tonnes.

LME INDEX: The London Metal Exchange (LME) base metals index is on track to clock its best quarter since 2010, rising 10 percent over the last three months.

STEELMAKERS: Authorities in China's northern province of Hebei found privately owned steelmaker Hebei Jingye Group lacked environmental protection facilities and had tampered with instruments monitoring discharges, the state-run China Daily newspaper reported on Friday.

China's crackdown on pollution has helped boost prices in aluminum by about 26 percent this year on expectations of widespread capacity shutdowns during winter.

LME aluminum was steady on Friday at $2,129.

U.S DEMAND: New orders for U.S.-made capital goods rose more than expected in August and shipments maintained their upward trend, pointing to underlying strength in the economy despite an anticipated drag on growth from Hurricanes Harvey and Irma.

PRICES: Lead rose 0.7 percent to $2,488, tin added 0.4 percent to reach $20,675, zinc was steady at $3,146.50 after touching a four-week high and nickel was slightly lower at $10,435.

(Additional reporting by Naveen Thukral in Singapore; editing by David Clarke)