Sep 17, 2012 (Dow Jones) NEW YORK--Copper prices fell Monday on weak manufacturing data from the U.S. and as some investors moved to cash in gains made on last week's rally.

Copper for December delivery, the most actively traded contract, fell 4.05 cents, or 1.1%, to settle at $3.7920 a pound on the Comex division of the New York Mercantile Exchange.

Copper futures had rallied 5.1% over the past week, fuelled by the Federal Reserve's decision to launch new stimulus measures. The bond purchasing program, commonly known as QE3, will see the central bank buy around $40 billion in mortgage-backed bonds each month as it aims to stoke growth.

Monday's economic data showed that the U.S. economy could be in need of such support. The New York Federal Reserve's business conditions index slumped to -10.41 in September, after it plunged more than 13 points to -5.85 in August.

Copper is widely used in manufacturing and construction, and investors look to economic data for clues about future demand for the metal.

The downbeat economic news added to a generally weak sentiment as investors looked to reassess their positions after a volatile week.

"There was a sense that the market was running out of steam today," said brokers at Sucden Financial, in a note to clients.

RBC Capital Markets attributed the bulk of Monday's losses to trading on low volume that was done by "some looking to take money off the table in wake of China remaining a key issue for metal markets."

Individual trades have a greater impact on price discovery when overall trading volumes are thin.

A stronger dollar further weighed on dollar-denominated copper futures. The Wall Street Journal Dollar Index, the broadest measure of the dollar based on foreign exchange trading volume, was recently up 0.3% at 69.168.

Copper is traded in dollars and becomes more expensive for investors who use other currencies when the dollar strengthens, pushing those buyers out of the market.

Copper settlements (ranges include electronic and pit trading):
Sep $3.2735; down 4.15 cents; Range $3.7655-$3.8290
Dec $3.2665; down 4.05 cents; Range $3.7270-$3.8300