(Updates with prices) LONDON, July 26 (Reuters) - Copper prices rose on Monday asfloods in top consumer China sparked demand hopes at a time wheninventories were falling, while a softer dollar also supportedprices. Benchmark copper on the London Metal Exchange was up3.2% at $9,820 per tonne by 1700 GMT, after touching its highestsince June 15 at $9,819.50, in its fifth straight session ofgains. Floods in central China, especially in the industrial andtransport hub city of Zhengzhou in Henan province, have raisedsupply concerns and demand for rebuilding damagedinfrastructure. Copper is mainly used in the construction and powerindustries and China accounts for about half of global copperconsumption. "Sentiment has brightened again in the last few days,reflected in the copper price," Commerzbank analyst DanielBriesemann said, adding he believed copper was due to fallfurther, having hit a record of above $10,700 a tonne in May. A Singapore-based trader said the market was pricing indisruptions to output from floods in Henan and demand forreconstruction.
INVENTORIES: On-warrant copper stocks in LME-registeredwarehouses fell to 205,800 tonnes, while metal inwarehouses monitored by the Shanghai Futures Exchange fell to the lowest since Feb. 10 at 96,087 tonnes. PREMIUMS: In a sign of rising physical demand in China,Yangshan premiums have climbed to $47.50 a tonne from recentlows of $21 touched in June. SPREADS: The discount of LME copper over the three-monthcontract narrowed to about $17 a tonne from about $42a tonne two weeks ago. This was the tightest since June 6. FED: The dollar softened as markets anticipated the outcomeof a meeting by U.S. Federal Reserve for clues on the pace ofmonetary policy changes, which has implication for liquidity andbase metals. OTHER PRICES: Aluminium gained 0.2% to $2,507 atonne, zinc was up 1.5% to $3,008.50, lead shed 0.1% to $2,372, tin hit a record of $34,815 and nickel rose 1.8% to $19,760 after touching its highest sinceFeb. 25. (Reporting by Zandi Shabalala, additional reporting by MaiNguyen; Editing by Louise Heavens and Mark Potter)
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