July 6, 2018 / 10:08 AM / 2 years ago

METALS-Copper pares losses, some see fresh 11-month low as bottom

* Copper set for steepest weekly drop since Jan 2015

* GRAPHIC-2018 asset returns: tmsnrt.rs/2jvdmXl (Updates with closing prices)

By Eric Onstad

LONDON, July 6 (Reuters) - Copper rebounded on Friday from a fresh 11-month low, as some investors regard the recent sharp losses as exaggerated and believe the metal has hit bottom.

Copper, widely viewed as a bellwether for the global economy, has been battered by escalating trade tensions that resulted in the United States imposing tariffs on $34 billion of Chinese imports and Beijing quickly retaliating.

The recent downtrend - which has seen copper shed 14 percent since touching a 4-1/2 year peak of $7,348 in early June - was fuelled by computer-driven speculators and long liquidation by Chinese hedge funds, said Gianclaudio Torlizzi, Partner at consultancy T-Commodity in Milan.

“Many people are wondering if the long-term bull market is over. I don’t think it’s over but copper has to hold above $6,200, which is the watershed level for the long-term uptrend,” he said.

“It doesn’t make any sense to have such a gloomy sentiment on metals demand. This is a good opportunity to go long again,” Torlizzi added, saying he had already taken a long position.

Three-month copper on the London Metal Exchange fell as much as 2 percent to $6,221.50 a tonne, its lowest since July 25, 2017, before recovering to $6,282, down 1 percent, by the close of open outcry trading.

LME copper shed more than 5 percent this week, its steepest weekly drop since January 2015.

* ESCONDIDA: Supporting copper was news that negotiations between workers and BHP Billiton Plc at the Escondida copper mine in Chile, the world’s largest, are “far from reaching agreement” with less than three weeks to go before the negotiation deadline.

* ZINC: LME zinc gained 1.3 percent to end at $2,735 a tonne, supported by a report from state Chinese research institute Antaike saying zinc production in China would fall to its lowest level since 2015 in the third quarter, according to a note by Commerzbank.

* NICKEL: LME nickel slipped 1.8 percent to $13,945 a tonne after touching $13,830, the weakest since May 11.

* ALUMINIUM: LME aluminium rose 0.1 percent to finish at $2,080 a tonne after touching $2,071, the weakest since April 9, as Chinese alumina refiners cut production.

* PRICES: Lead dropped 1 percent to close at $2,332 a tonne while tin dipped 0.4 percent to $19,325 after touching $19,330, the lowest since Dec. 21 last year.

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($1 = 6.6525 Chinese yuan)

Additional reporting by Tom Daly in Beijing; Editing by Mark Potter, Kirsten Donovan and Jan Harvey

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