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METALS-Zinc hits 5-1/2 month low on G20, Iran uncertainties

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* GRAPHIC-2019 asset returns: (Updates with closing prices) By Eric Onstad LONDON, June 21 (Reuters) - Zinc hit its lowest since early January and other industrial metals also fell on Friday as investors assessed risks ahead of next week's G20 meeting and rising U.S.-Iran tensions. Base metals had rallied the previous session after the U.S. central bank signalled rate cuts, while U.S. President Donald Trump approved military strikes against Iran before calling them off at the last minute, the New York Times reported. "There's a feeling that central banks threw money into the system and markets reacted well yesterday, but now you have a sobering morning," said Oliver Nugent, analyst at Citigroup in London. Nugent said the market was more concerned that fresh negotiations about a U.S.-China trade deal at next week's G20 meeting might not go well. "Everyone's got the G20 meeting in their sights right now, and holding a position ahead of that is what's dominating the market," he said. "We've cautioned that in the event of a trade escalation, the dollar would rally further, oil would be sold off and copper could hit $5,500 or even breach that." Benchmark zinc on the London Metal Exchange dropped 1.4% in closing open-outcry trading to $2,433 a tonne, having touched $2,412, the weakest since Jan. 4.

LME copper ended down 0.03% at $5,971 a tonne after hitting a near one-month high of $6,027 on Thursday.

Copper scored a 2.5% gain this week, its biggest weekly increase since the week ended March 29. The metal has been buoyed partly by strike action at Chile's Codelco, the world's largest copper producer.
* ALUMINIUM PREMIUMS: Premiums for Japanese aluminium shipments for July to September were set at $108 per tonne, up 3% from the current quarter, as tighter supply in Asia outweighed fears over weakening demand.
* ALUMINIUM POSITION: LME aluminium "exhibits the largest net spec short of the complex on our estimate at 19% of open interest," Alastair Munro at broker Marex Spectron said in a note. LME aluminium shed 0.8% to finish at $1,767.50 a tonne.
* CHINA ZINC STOCKS: Zinc inventories in warehouses monitored by the Shanghai Futures Exchange climbed 7.6% from last Friday to 86,046 tonnes, the exchange said.
* OTHER METALS: LME nickel retreated from a three-week top struck on Thursday, declining 1.7% to close at $12,090. Lead fell 0.2% to $1,900 and tin lost 0.7% to $19,025.
* For top stories in metals and other news, click or <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Top Base and Precious Metals Analysis - GFMS ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> (Additional reporting by Tom Daly in Beijing Editing by Jan Harvey and David Holmes)

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