Copper hits 4-mth peak as growth outlook brightens

* Factory activity picks up in all three key global regions
    * Worries about supply, Spain jobless knock copper off peaks
    * LME zinc hits one-year high, nickel approaches one-year peak

    By Maytaal Angel
    LONDON, Feb 4 (Reuters) - Copper rose to four-month peaks on Monday thanks
to signs of a credible U.S. recovery and improved factory activity across the
globe, though gains were limited by rising supply and by debt worries centered
on Spain.
    Benchmark LME copper hit $8,346 a tonne, a peak since Oct. 5, before easing
to $8,303. But that was still up 0.15 percent from the previous session, when
the metal saw its biggest weekly gain since September at 3.2 percent.
    "If you have acceleration of growth (and) a better outlook for demand, I
don't think you have a massive risk of an impending correction. The only thing
that's missing is strengthening in the physical market," Merrill Lynch Bank of
America analyst Michael Widmer said.  
    "In the first quarter if we stayed around current levels, I wouldn't be
surprised, but over the summer months we're going to move higher."
    Also on the LME, three-month zinc CMZN3 marked its highest in one year at
$2,190, while nickel CMNI3 was approaching a one-year top above $18,770, its
high from October last year.
    The economic outlook brightened considerably last week after data showed
U.S. manufacturing growth quickened in January and hiring increased, factory
data in China showed factories extending a modest rebound, and
euro zone factory data suggested the worst of the region's downturn may be over.
     Monetary easing plans announced by the U.S. Federal Reserve, which came
despite the improved U.S. data, also buoyed sentiment. 
    On Sunday, China's official purchasing managers' index (PMI) for the
services sector posted a fourth-straight monthly rise in January, although its
slim gain added to evidence that the global recovery is a modest one.
    But Spain dampened the mood in Europe by reporting that its unemployment
problems were worsening, while a corruption scandal threatened to engulf Prime
Minister Mariano Rajoy.
    Open interest and volumes on LME copper last week hit the highest this year. 
    
    RISING STOCKS
    Markets in China, which accounts for 40 percent of refined copper demand,
will be closed next week for its New Year holiday celebrations, and participants
do not expect to see an uptick in demand before then.
    "China, is largely out of the market ahead of the Lunar New Year holidays.
While the improving macro picture has underpinned metals, there is also the
perception that supply availability has increased to maintain the status quo,"
Societe Generale analyst Robin Bhar said.
    "No base metal is in backwardation (supply tight) right now as contango
markets (supply not tight) prevail. Underlining this fact is that LME stocks are
increasing for metals such as copper, nickel and tin."
    LME stocks data out earlier showed a 1,800 tonne dip in copper stocks to 374,200 tonnes, though they remained near their highest since
December 2011 and have increased by some 75 percent since October last year. 
    In other metals traded, soldering metal tin rose 0.90 percent to
$25,125 a tonne, while zinc, used in galvanizing edged up 0.17 percent
to $2,178.75 a tonne.
    Battery material lead rose 0.72 percent to $2,468.75 a tonne,
aluminium climbed 0.33 percent to $2,125 a tonne, while stainless-steel
ingredient nickel rose  0.75 percent to $18,765 a tonne.