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Open-outcry trading was slow in Monday's official rings on the London Metal Exchange (LME), with minor gains in the afternoon paring earlier losses, market sources said.
Most metals, with the exception of tin, took their cue from copper, although there was no heavy downside pressure in the absence of related news at the weekend.
"We started down a little lower, then came back in the afternoon, and then eased down a bit towards the end, on the back of some dollar strength, I think," a trader said.
The dollar gained against other major currencies on Monday as United States officials took exception to European talk about curbing euro strength ahead of a meeting of finance ministers from the Group of Seven industrial nations.
However, potential existed for more activity and movement this week.
Economic data will be in focus, notably the Federal Reserve Open Market Committee (FOMC) interest-rate meeting on Tuesday, but more attention will be directed at micro-fundamentals.
"The nickel market will be on edge ahead of the expiry of the current Falconbridge labour contract at the end of the week, while many in the copper market will be looking to the Phelps Dodge earnings announcement on January 29 for news on the fate of its idled North American capacity that is now more than economic at current copper prices," analyst Martin Fewings of Mitsui Bussan Commodities said.
Residual buying kept copper underpinned and restricted losses. Last official ring trade was at $2,446 a tonne, down $14 from Friday's kerb close.
The market continued to draw strength from persistent falls in warehouse inventories, with stocks dropping 3,825 tonnes to 381,075 tonnes on Monday, the lowest since March 2001
Aluminium managed to avoid falling back into the recent stagnant $1,600/1,630 range, ending at $1,634, a $2 loss.
Tin bucked the trend on cash interest against a background of nearby tightness, ending up at $6,280 to post a $70 gain.
"The market is looking good on the charts - it is holding the $6,200 floor, which suggests it can get back up to $6,400," a trader said.
Nickel was hesitant, with the market likely to be cautious all week in the countdown to the Falconbridge labour contract expiry on January 31.
Three months was quoted at $14,600, a $230 loss.
Zinc slipped $16 to $1,016, while lead was $5 lower at $750.

Copyright Reuters, 2004

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