UPDATE AS OF LME CLOSING ON 1 SEPT, 2008

Copper futures fell 1.8 percent on Monday under pressure from

gains in the dollar, rising London Metal Exchange stocks and worries

about demand.

Zinc eased but Hurricane Gustav was seen as a potential threat to LME

warehouses, analysts said. [ID:nL1329617]
Volumes were low with the U.S. market shut for Labor Day.

"The stronger dollar is troubling prices," Commerzbank analyst

Eugen Weinberg said. "We cannot expect large moves today

as the U.S. is closed."

London Metal Exchange three-month copper fell 1.8 percent,

or $138, to $7,372 per tonne by 0956 GMT. Earlier, it hit an intraday low

of $7,305, the lowest price since Aug. 19.

Nickel fell 3.2 percent to a two-week low of $19,600 before

trading at $19,650 against Friday's $20,250.

Stocks rose 1,206 tonnes to a four-month high of 48,228 and the metal

is down 24 percent this year as demand from stainless steel producers,

accounting for two-thirds of nickel off-take, has fallen short of expectations.

The dollar approached an eight-month high against a trade-weighted

basket of currencies <.DXY>, and a fall in the euro to below $1.4570

would take the single currency to its lowest level since mid-February.

[ID:nL1710526]
A firm U.S. currency makes dollar-priced metals more expensive for

holders of other currencies.


RISING COPPER STOCKS
LME copper stocks are at their highest since February, at 173,725 tonnes,

although the latest release from the International Copper Study Group said

the copper market was in deficit by 155,000 tonnes in the first five months of the year.