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METALS-London copper drifts lower in thin pre-holiday trade

BEIJING, Dec 23 (Reuters) - London copper prices slipped for a second straight day on Monday in thin pre-holiday trade, as a rally fuelled by optimism over the 'phase one' trade deal between the United States and top metals consumer China began to run out of steam. The London Metal Exchange will remain closed on Dec. 25-26 for the Christmas holiday.

FUNDAMENTALS

* COPPER: Three-month copper on the London Metal Exchange dipped 0.3% to $6,158 by 0259 GMT, after closing down 0.6% in the previous session. The most-traded February copper contract on the Shanghai Futures Exchange fell 0.6% to 48,950 yuan ($6,981.79) a tonne.

* CHINA TARIFFS: China will lower import tariffs on over 850 products from Jan. 1, the finance ministry said.

* CODELCO: Chile's state copper miner Codelco said on Friday it would cancel a contract awarded in November to a consortium led by Japanese firm Marubeni to construct a desalination plant to feed its northern mines.

* SCRAP: China's imports of scrap metal in November rose by 6.3% from the previous month to 170,000 tonnes, data released by the General Administration of Customs showed on Monday.

* MERCURIA: Commodity trading giant Mercuria has axed up to a quarter of its Shanghai trading team, including base metal and petrochemical traders, as it looks to reduce the risk in its portfolio, according to three sources with knowledge of the matter.

* ICBC: ICBC Standard Bank has abandoned proposals to shut its base metals business and instead plans to merge it with the precious metals unit to cut costs, the bank told Reuters in an emailed statement.

* RARE EARTHS: The U.S. military plans to stockpile rare earth magnets used in Javelin missiles and F-35 fighter jets, according to a government document seen by Reuters.

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MARKETS NEWS

* Asian markets idled near 18-month highs as volumes weakened ahead of the Christmas holiday break and investors squared off their positions, taking home hefty gains made earlier this month.

DATA/EVENTS AHEAD (GMT) 1230 U.S. Durable Goods Nov 1230 U.S. Durables ex-Transport Nov 1330 Canada GDP MM Oct 1500 U.S. New Homes Sales Units Nov 2350 Japan Bank of Japan releases minutes of monetary policy meeting held on Oct. 30 and 31. PRICES

BASE METALS ARBITRAGE

3

3

3

3

3 ($1 = 7.0111 Chinese yuan)

(Reporting by Tom Daly; Editing by Rashmi Aich)