* Cash tin commands premium over three-month futures
* Nickel down 3 percent this week
* Chinese holiday keeps trading volumes low
(Updates after U.S. weekly jobs data)
By Swetha Gopinath
LONDON, Oct 6 Copper hit a two-week low on
Thursday after jobless claims suggested further improvement in
the U.S. jobs market, increasing the chances of a Fed rate rise
later this year and so boosting the dollar.
Benchmark copper on the London Metal Exchange ended
at $4,758 a tonne, down 0.9 percent, having earlier touched
$4,750, the lowest since Sept. 20. Traders said volumes were
subdued by a week-long holiday in China.
A stronger U.S. currency makes dollar-denominated
commodities more expensive for non-U.S. firms -- a relationship
used by funds to generate buy and sell signals for short-term
The number of people filing for unemployment benefits in the
United States fell unexpectedly last week to near a 43-year low.
But much will depend on U.S. non-farm payrolls on Friday, seen
as a critical gauge of the economy's health.
"Tomorrow is the big day ... if we see positive data we
could see the dollar strengthen further," said Sergey Raevskiy,
analyst at investment bank SP Angel.
But analysts still expect China to be the main driver for
copper over coming months. China accounts for about half of
global consumption estimated at around 22 million tonnes this
Aluminium ended up 0.1 percent at $1,677 a tonne and
zinc settled one percent lower at $2,320. Lead
ended 0.5 percent higher at $2,054.50.
"Zinc and nickel to a lesser extent appear most supply
constrained with expected deficits in the next two years," said
Koen Straetmans, senior strategist at NN Investment Partners.
"Aluminium, in contrast, appears to remain structurally
oversupplied over the next years."
Nickel ended 1.7 percent higher at $10,255 a tonne, but it
has fallen more than 3 percent this week on receding worries
over supplies from the Philippines and expectations of higher
supplies from Indonesia.
The Philippines said on Friday that it might not halt
operations at all 20 mines facing suspension for environmental
violations and will give them time to address problems, a
softening of the stance that has resulted in 10 mine closures.
Tin finished 1 percent higher at $20,095 a tonne on
worries about shortages on the LME market, where two companies
hold large amounts of warrants and cash contracts.
Those positions were the reason for Wednesday's premium of
nearly $90 a tonne for the cash contract over three-month tin
Three month LME copper
Most active ShFE copper
Three month LME aluminium
Most active ShFE aluminium
Three month LME zinc
Most active ShFE zinc
Three month LME lead
Most active ShFE lead
Three month LME nickel
Most active ShFE nickel
Three month LME tin
Most active ShFE tin
(Editing by David Goodman)