METALS-Shanghai copper falls 1 pct; demand outlook supports

* U.S. June job data disappoints; ECB kept rates at 1 pct

* Summer copper demand low, but H2 outlook optimistic

* Shanghai copper warehouse stocks up 7 pct
(Adds Shanghai and LME warehouse data; updates prices)

By Rujun Shen and Edmund Klamann

SHANGHAI, July 3 (Reuters) - Shanghai copper ended down 1
percent on Friday, after dismal U.S. job data raised doubts
about a speedy economic recovery, but traders and analysts
expect demand for the industrial metal to improve in the second
half of the year despite the summer lull.

The United States lost more jobs in June than expected,
while the unemployment rate hit 9.5 percent, the highest in
nearly 26 years, dimming hopes for a rapid economic recovery.
[nN02549309]

Also on Thursday, the European Central Bank chairman warned
that the economy may only gradually recover by mid-2010, as the
bank kept euro zone interest rates at 1.0 percent and euro zone
unemployment rose to a 10-year high of 9.5 percent. [nL2512532]

"When prices fall, buying emerges. But when prices rise, no
one follows up to push them higher. It's the summer lull after
all, and consumption is weak. So copper prices are kind of
stuck," said a Shanghai-based trader.

"But consumption of the metal in the second half of year
will improve."

Shanghai's benchmark third-month futures contract SCFc3
closed at 39,860 yuan a tonne, down 0.8 percent to the lowest
closing price of the week. It fell 1.3 percent from a week
earlier.

The most-active contract for October delivery SCFV9 fell
1 percent lower to 39,760 yuan a tonne.

Copper for three-month delivery on the London Metal
Exchange MCU3 lost $77 to $4,958 a tonne by 0826, headed to a
1.5 percent weekly decline.

LME copper has risen 62 percent this year, mostly due to
Chinese buying, as Beijing took advantage of low prices to
build state reserves and its stimulus plan boosted demand for
the metal.

"As prices increase, you are getting close to that point
where they decide they are good enough in stockpile, they are
good enough in strategic reserves, and there's not much value
in the price. As a result the demand for these metals wane,"
said Ben Westmore, commodities economist at National Australia
Bank.

LME copper inventories rose for the first time since early
May on Friday. It rose 4,050 tonnes to 268,275 tonnes.

Shanghai copper warehouse stocks rose 7 percent on the week
to 59,980 tonnes.

To view a graphic on global copper stocks, click:
here

The strength in the U.S. dollar is weighing on metals
priced in dollars. The dollar held near its highest levels in a
week against the euro on Friday. [USD/]

Shanghai aluminium SAFc3 edged up 0.2 percent to 13,490
yuan a tonne, ending the week 0.3 percent lower, and London
aluminium shed $21 to $1,619 by 0826 GMT.

LME aluminium inventories rose 3,400 tonnes on Friday to a
record high of 4.4 million tonnes.

"Shanghai aluminium is trying to catch up with the strength
in copper in the previous rally. It was lagging behind," said
Wang Zhouyi, an analyst with Shanghai COFCO Futures.

Shanghai aluminium has gained 17 percent this year, while
Shanghai copper has jumped 67 percent.
Base metals prices at 0826 GMT
Metal Last Change Pct Move End 2008 Pct chg
09
LME Cu 4958.00 -77.00 -1.53 3060.00
62.03
SHFE Cu* 39860.00 -330.00 -0.82 23840.00
67.20
LME Alum 1619.00 -21.00 -1.28 1535.00
5.47
SHFE Alum* 13490.00 25.00 +0.19 11540.00
16.90
COMEX Cu** 224.50 -4.50 -1.97 139.50
60.93
LME Zinc 1550.00 -10.00 -0.64 1208.00
28.31
SHFE Zinc 13380.00 -20.00 -0.15 10120.00
32.21
LME Nickel 16160.00 -290.00 -1.76 11700.00
38.12
LME Lead 1683.00 -17.00 -1.00 999.00
68.47
LME Tin 14250.00 -50.00 -0.35 10700.00
33.18
LME/Shanghai arb^ -226
Dollar/yuan 6.8325 \ 6.8345
** 1st contract month for COMEX copper
* 3rd contact month for SHFE aluminium, copper and zinc
^ LME 3-m copper in yuan, including 17 pct VAT, minus SHFE
third month
(Editing by Ben Tan)