* Antofagasta cuts annual production guidance
* Analyst sees Fed boosting dlr, pressuring commodities
* Coming Up: Fed policy statement at 1800 GMT
(Updates with closing prices)
By Pratima Desai and Eric Onstad
LONDON, July 29 (Reuters) - Copper rose on Wednesday after
the Chinese stock market rebounded, though investors were
nervous ahead of a statement from the Federal Reserve, which
could set the stage for a U.S. interest rate hike in September
and a potentially firmer dollar.
Copper's rise was also fuelled by hopes of more stimulus in
China, the world's top consumer of industrial metals.
Benchmark copper CMCU3 on the London Metal Exchange closed
up 0.6 percent at $5,330 a tonne after a volatile session that
saw it touching an intraday high of $5,398 and also slump into
negative territory.
The metal used in power and construction, down about 15
percent so far this year, hit a six-year low of $5,164 on Monday
when Chinese equities tumbled 8 percent.
Chinese shares bounced back by more than 3 percent on
Wednesday, but the positive impact on metals faded later in the
session as investors turned attention to a policy statement from
the U.S. Federal Reserve due at 1800 GMT. ID:nL1N108249
ID:nL3N1091PX
"We should see dollar strength and possible pressure on the
commodities once the statement is out, as this would be the last
communication from the central bank until the key September
meeting," said analyst Edward Meir at brokerage INTL FCStone.
A stronger U.S. currency makes commodities more expensive
for holders of other currencies.
One factor supporting copper was the expectation by many
investors that Beijing will step up its stimulus programmes.
"China is struggling, but it's not imploding. The equity
selloff will have a negative impact on the economy in the third
quarter," said Leon Westgate, analyst at ICBC Standard Bank.
"China's economy is going to need a helping hand to achieve
growth targets. Copper is probably now reasonable value."
Beijing is targeting 7 percent economic growth this year.
Other analysts cite stronger demand growth for the fourth
quarter in China and tighter supplies as a reason to be
optimistic for copper's prices prospects.
"We reiterate our view that a significant proportion of
copper mine output is struggling at these price levels,"
Macquarie said in a note.
On Wednesday, Antofagasta ANTO.L cut its full-year copper
production guidance. ID:nL5N10919B
In other metals, soldering metal tin CMSN3 jumped to
$16,340, its highest since May 6 on short position covering.
ID:nL5N1092YJ
Tin failed to trade in closing open outcry activity and was
last bid unchanged at $16,150 a tonne.
Aluminium CMAL3 also failed to trade in closing rings and
was bid up 0.4 percent at $1,662 a tonne.
Nickel CMNI3 closed down 0.7 percent at $11,250 a tonne
after LME inventories rose 5,310 tonnes, highlighting oversupply
in the market.
Zinc CMZN3 ended down 0.7 percent at $1,966 a tonne, while
lead CMPB3 added 0.2 percent to $1,725.
PRICES
Three month LME copper CMCU3
Most active ShFE copper SCFcv1
Three month LME aluminium CMAL3
Most active ShFE aluminium SAFcv1
Three month LME zinc CMZN3
Most active ShFE zinc SZNcv1
Three month LME lead CMPB3
Most active ShFE lead SPBcv1
Three month LME nickel CMNI3
Most active ShFE nickel SNIcv1
Three month LME tin CMSN3
Most active ShFE tin SSNcv1
(Editing by David Holmes and Susan Fenton)