July 26 (Reuters) - Copper hit its highest in nearly six
weeks on Monday, as investors sold equities for more attractive
assets, with prices further supported by supply worries and
hopes of more metals' demand for rebuilding infrastructure after
floods in China.
Three-month copper on the London Metal Exchange rose
by 1.1% to $9,620 a tonne by 0712 GMT, after gaining as much as
1.6% to $9,665 a tonne, its highest since June 16.
The most-traded September copper contract on the Shanghai
Futures Exchange closed up 1.7% at 70,770 yuan
($10,914.39) a tonne, after hitting a June 15 high of 71,150
yuan a tonne earlier in the session.
Chinese shares slumped as education and property sectors
dropped on worries over heavy-handed government regulations,
making commodities such as metals an attractive alternative
Floods in central China, especially in the industrial and
transport hub city of Zhengzhou in Henan province, have raised
supply concerns and demand for rebuilding damaged
infrastructure, which will consume industrial metals.
"Because of the crackdown in regulation... market switched
away from equities to metals. So, ShFE fresh buying has been
relentless," said a Singapore-based trader, adding that metals
benefit from reflation trade.
"Market is also pricing in disruptions to output from Henan
floods and demand for reconstruction," the trader said.
* ShFE nickel hit a five-month high at 146,870 yuan
a tonne, aluminium reached its highest since May 19 of
19,750 yuan a tonne while lead fell 1.2% to 16,065 yuan
* LME nickel touched its highest since Feb. 25 at
$19,645 a tonne, while tin fell 0.9% to $34,200 a tonne.
* ShFE copper inventories <CU-STX-SGH> fell to their lowest
since Feb. 10 at 96,087 tonnes while the Yangshan copper premium
<SMM-CUYP-CN> rose to a 11-week high of $43 a tonne, indicating
improving demand for imported metal.
* For the top stories in metals and other news, click
($1 = 6.4841 yuan)
(Reporting by Mai Nguyen in Hanoi; Editing by Ramakrishnan M,
Kim Coghill, Uttaresh.V and Louise Heavens)