* ShFE aluminium shows signs of finding short-term floor
* Copper set for new lows, targets $4,200-4,500 -UBS
* Coming up: Fed policy statement at 1800 GMT (Adds detail, updates prices)
By Melanie Burton
MELBOURNE, Oct 28 (Reuters) - London copper slipped on Wednesday with patchy economic indicators in the United States casting doubt over the strength of global economic growth ahead of the outcome of a Federal Reserve meeting later in the session.
Matched with ongoing signs top metals user China is struggling to shore-up growth after a limp response to last week’s rate cut, prices will likely head lower, analysts said.
“What you get from China is still a slowdown but a smaller slowdown. Maybe it’s enough for equities to do well, but I’m not sure it’s enough for copper,” said analyst Dominic Schnider of UBS in Hong Kong, who expects ample copper stocks to drag on prices through the first half of next year.
“I’m negative and look for a renewed drop in copper, somewhere around $4,200-4,500 as the market realises ‘yes, there’s a surplus’.”
Three-month copper on the London Metal Exchange had slipped 0.9 percent to $5,175.50 a tonne by 0700 GMT after closing a touch firmer in the previous session. Prices have been trading in a narrow band of $5,130-$5,320, with traders on alert for a breakout to the downside.
Shanghai Futures Exchange copper erased early gains, slipping 0.4 percent to 38,930 yuan ($6,126.30) a tonne.
A gauge of U.S. business investment plans fell for a second straight month in September, pointing to a sharp slowdown in economic growth and casting more doubts on whether the Fed would raise interest rates this year.
Profits earned by Chinese industrial companies fell 0.1 percent in September from a year earlier, data from the statistics bureau showed on Tuesday, levelling after a record 8.8-percent collapse in August.
Illustrating pressure on miners, Southern Copper Corp said on Tuesday its net profit tumbled 70 percent to $98.4 million in the third quarter after copper prices fell sharply.
Meanwhile, investors were also turning less optimistic on the metal. The total net long position of funds trading copper on the LME fell to 14,852 lots last Friday from a net long of 20,532 lots the previous week, the exchange’s Commitments of Traders Report (COTR) showed on Tuesday.
Elsewhere, Russia’s United Company Rusal Plc held its aluminium output steady in the third quarter and reaffirmed it was reviewing some of its operations, as global prices droop to six-year lows.
ShFE aluminium prices have struck successive record lows for most of October, including on Thursday, amid energy sector reform in China that has driven down power costs.
LME aluminium hit a fresh six-year low at 1465.50 a tonne.
Three month LME copper
Most active ShFE copper
Three month LME aluminium
Most active ShFE aluminium
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 ($1 = 6.3562 Chinese yuan renminbi) (Reporting by Melanie Burton; Editing by Joseph Radford)