Jan 7 (Reuters) - London copper prices rose on Friday, supported by a rebound in equities and tight supply, but a firmer dollar and expectations of an early U.S. interest rate hike kept the metal on track for its biggest weekly decline since November.
Three-month copper on the London Metal Exchange was up 0.5% at $9,575.5 a tonne as of 0810 GMT, but was down 1.5% for the week.
The most-traded February copper contract on the Shanghai Futures Exchange closed down 0.5% at 69,520 yuan ($10,910.69) a tonne.
Market sentiment improved a little bit after participants digested the hawkish U.S. Federal Reserve's minutes of December policy meeting, a Singapore-based trader said, adding that concerns over tight supply, already affected by COVID-19-related controls, were exacerbated by the unrest in Kazakhstan.
On-warrant copper stocks in LME-registered warehouses were last at 80,525 tonnes, up from a historic low of 14,150 tonnes in October but far below peaks seen in August.
Asian shares snapped two days of losses, as investors awaited U.S. jobs data, while the dollar index was headed for its first weekly gain in three.
While a firmer U.S. dollar makes greenback-priced metals more expensive to holders of other currencies, an interest rate hike could trim liquidity in financial markets and slow recovery in the world's biggest economy.
The LME aluminium contract was headed for its biggest weekly rise since October, mostly driven by surging power prices in Europe prompting output cuts at smelters.
"The global aluminium market will remain undersupplied in 2022 (as well)... A reversal of temporary closures in China in spring might still lead aluminium prices down, but we believe that ultimately, aluminium fundamentals remain strong," according to a BofA Global Research report.
Aluminium was up 1.9% to $2,976.5 a tonne, nickel rose 1.4% to $20,665, lead edged 0.4% higher to $2,316, zinc gained 0.9% to $3,581.5 and tin rose 0.9% to $39,495.
* ShFE aluminium gained 2.3% to 21,130 yuan a tonne, after hitting a peak since Oct. 27 earlier. Nickel rose 0.8% to 152,490 yuan a tonne, zinc was up 0.2% at 24,500 yuan, lead climbed 1.9% to 15,415 yuan and tin rose 0.8% to 298,100 yuan.
* Sentiment was further buoyed after Beijing reiterated the need to pay more attention to stabilising growth which bolstered hopes of policy easing.
* Indonesia's power emergency which triggered a coal export ban is over but the government will still continue to discuss policies in this area on Friday, a senior cabinet minister told local media.
($1 = 6.3754 Chinese yuan renminbi)
Reporting by Eileen Soreng in Bengaluru; editing by Rashmi Aich and Jason Neely
Source: Reuters