SHANGHAI, July 19 (Reuters) - Copper held steady on Thursday after better-than-expected housing data from the United States and China, eased concerns over the impact on demand from a slowdown in the global economy.
But investors are expected to remain cautious, capping gains, with an eye on the euro zone after German Chancellor Angela Merkel's comments that a solution to the bloc's problems was not yet in sight, rekindling fears about the grouping's finances.
Three-month copper on the London Metal Exchange rose 0.2 percent to $7,655 per tonne by 0136 GMT, extending modest gains after ending the prior session up 0.6 percent.
The most active November copper contract on the Shanghai Futures Exchange rose 0.2 percent to 55,880 yuan ($8,800) per tonne, after falling 0.3 percent previously.
Home prices in China, the world's biggest consumer of industrial metals, broke eight straight months of declines in June in a tentative sign that pro-growth policies are gaining traction in the world's second-biggest economy, now in its longest sequential slowdown since the global financial crisis.
Groundbreaking on new U.S. homes rose in June to the fastest pace in more than three years, lending a helping hand to an economy that has shown worrisome signs of cooling.
Comments from German Chancellor Angela Merkel cited in a media report reignited worries about the euro zone, just as German lawmakers gather to vote on Berlin's contribution to a euro zone aid package for Spain's ailing banks.
"We have not yet shaped the European project so that we can be sure that everything will turn out well, we still have work to do," Merkel was quoted in a media report as saying.
Greek coalition leaders agreed to meet next week to hammer out almost 12 billion euros worth of austerity cuts demanded by the near-bankrupt country's lenders after a deal proved elusive at an initial round of talks on Wednesday.
Economic growth in the United States cooled in June and early July and hiring grew at a tepid pace in much of the country, the Federal Reserve said on Wednesday.
Asian shares rose on Thursday as strong corporate profits from U.S. bellwethers allayed fears of a slowdown in earnings.
The euro steadied in Asian trade on Thursday but remained under pressure after reported comments by German Chancellor Angela Merkel underlined fears about the euro zone debt crisis.
1230 U.S. Jobless claims
1400 U.S. Existing home sales
1400 U.S. Leading indicators
1400 Philadelphia Fed business activity index
European Central Bank governing council meeting
Base metals prices at 0136 GMT
Metal Last Change Pct Move YTD pct chg
LME Cu 7655.00 18.00 +0.24 0.72
SHFE CU FUT NOV2 55880 120 +0.22 0.45
LME Alum 1910.00 1.00 +0.05 -5.45
SHFE AL FUT OCT2 15570 05 +0.03 -1.70
HG COPPER SEP2 347.20 -0.20 -0.06 1.05
LME Zinc 1871.00 3.00 +0.16 1.41
SHFE ZN FUT OCT2 14800 15 +0.10 0.03
LME Nickel 16100.00 0.00 +0.00 -13.95
LME Lead 1900.00 -10.00 -0.52 -6.63
SHFE PB FUT 0 -14960 -100.00 -100.00
LME Tin 18800.00 0.00 +0.00 -2.08
LME/Shanghai arb 1164
Shanghai and COMEX contracts show most active months
^ LME 3-m copper in yuan, including 17 pct VAT, minus SHFE third month
($1 = 6.3702 Chinese yuan)