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METALS-Copper steady near 10-week high, focus on U.S.-China trade dispute

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* Copper market fundamentals seen sound
* Rusal sanctions extension weighs on aluminium (Releads, updates with official prices) By Pratima Desai LONDON, Sept 24 (Reuters) - Copper prices slipped on Monday, but held near 10-week highs hit last week as the market waited to see how the U.S.-China trade dispute would develop after both countries imposed new tariffs on imports. Benchmark copper on the London Metal Exchange traded down 0.7 percent at $6,320 a tonne in official rings. The metal, seen as a gauge of economic health, hit $6,382.5 on Friday, a gain of 4.62 percent, the largest one-day rise since May 2013. Friday's rally was mainly due to tariff levels that were much lower than expected. "The market was fretting U.S. tariffs could be as high as 25 percent from the start. It was a relief rally," Societe Generale analyst Robin Bhar said. "Fundamentals are pretty sound, demand is strong."

TARIFFS: U.S. tariffs on $200 billion of Chinese goods and retaliatory tariffs by Beijing on $60 billion of U.S. products took effect on Monday. The United States will levy tariffs of 10 percent initially, rising to 25 percent at the end of 2018. Beijing has imposed rates of 5-10 percent and warned it would respond to any rise in U.S. tariffs on Chinese products accordingly. STOCKS: Strong copper demand can be seen in stocks held by LME-registered warehouses, which at 214,350 tonnes are down more than 40 percent since late March and near their lowest since January.

Cancelled warrants - metal earmarked for delivery and no longer available - stand at 32.5 percent. HOLDINGS: Worries about nearby tightness on the LME market have been reinforced by two large holdings - between 30 and 39 percent - of copper warrants. That has created a premium of $16 a tonne for the cash over the three-month contract. DEMAND: China accounts for nearly half of global copper demand estimated this year at 24 million tonnes.

PREMIUMS: Premiums for metal on the physical market in China are at $122 a tonne, up nearly 40 percent since August. RUSAL: The U.S. Treasury on Friday extended until Nov. 12 a deadline for investors to divest holdings of debt, equity and other assets in sanctions-hit Russian companies EN+ and Rusal . ALUMINIUM: Expectations that sanctions on Rusal, a top aluminium producer, will be lifted after the U.S. mid-term elections on Nov. 6 are weighing on prices of the transport and packaging metal.

"The extension suggests a softening and an eventual lifting of the sanctions," a source at a commodities trading firm said. PRICES: Aluminium was down 1.2 percent at $2,066, zinc gained 1.2 percent to $2,526, lead fell 0.3 percent to $2,033, tin fell 0.5 percent to $18,900 and nickel slid 1.3 percent to $13,075.
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Top Base and Precious Metals Analysis - GFMS ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> (Reporting by Pratima Desai; Editing by Dale Hudson and Jane Merriman)

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