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METALS-Shanghai nickel nears 4-month high on EV hopes

Mai Nguyen

(Recasts, adds details & quotes, updates prices)

SINGAPORE, July 12 (Reuters) - Shanghai nickel prices rose to near their highest since March, as investors bet on the potential demand for the metal in the electric vehicle (EV) battery sector.

Shanghai Futures Exchange's most active nickel contract advanced as much as 1.4% to 104,130 yuan ($15,154.12) a tonne, its highest since March 7, while benchmark nickel in London dipped 0.5% from a three-month high hit in the previous session.

"We believe the main driver of the nickel price rally has been the sustained level of speculative buying ... due to the metal's ongoing allure as key demand-beneficiary among metals used in the growing EV battery market," Fitch said in a report.

Most other industrial metals traded in tight ranges, as investors exercised caution ahead of a key set of trade data from top metal player China due to be released later on Friday, including imports and exports figures of key base metals.

Prices were also pressured by a steady U.S. dollar, after stronger-than-expected U.S. inflation data tempered the prospect of an aggressive Federal Reserve interest rate cut later this month.

A stronger dollar makes greenback-prices metals more expensive for buyers using other currencies.

FUNDAMENTALS

* PRICES: Three-month copper on the London Metal Exchange edged up 0.1% at $5,959.50 a tonne by 0358 GMT, while aluminum fell 0.4% and lead declined 0.5%.

SHANGHAI: The most-traded copper contract on the Shanghai Futures Exchange rose 0.3% to 46,700 yuan a tonne, while aluminum fell 0.8%, nickel advanced 0.5%, zinc declined 0.6% and lead eased 0.1%.

* TRADE WAR: U.S. President Donald Trump said China was not living up to promises it made on buying agricultural products from American farmers as the world's two largest economies work to resolve a trade dispute.

* TIN: The tin market is under greater pressure from an economic slowdown and falling demand than supply issues, where lower production from countries such as Myanmar is likely to be offset by a new project in central Africa.

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DATA/EVENTS (GMT)

0700 China Exports YY June

0700 China Imports YY June

0700 China Trade Balance USD June

1200 India Industrial Output YY May

1200 France Reserve Assets Total June

-- China Total Social Financing June

-- China M2 Money Supply YY June

-- China New Yuan Loans June

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 = 6.8714 Chinese yuan)

(Reporting by Mai Nguyen; Editing by Rashmi Aich and Gopakumar Warrier)