METALS-Copper falls on shrinking Japanese economy

SHANGHAI, Feb 16 - Copper prices fell more than 2 percent in Shanghai and London on Monday, after Japan reported its biggest contraction in GDP since 1974, overwhelming positive sentiment from the passage of a U.S. stimulus package.

FUNDAMENTALS

* The most active Shanghai May copper contract fell 2.4 percent to 27,750 yuan a tonne by 0210 GMT, while three-month London Metal Exchange copper dropped 2.3 percent to $3,350 a tonne.

* U.S. President Barack Obama hailed congressional approval of a $787 billion economic stimulus bill as a "major milestone on our road to recovery" and the White House said he would sign the legislation on Tuesday.

* London nickel slumped 2 percent to $10,150, while aluminium fell $3 to $1,375.

* Anglo-Australian mining giant Rio Tinto said it was confident the Australian government would approve its $19.5 billion tie-up with Chinese state-owned aluminium-maker Chinalco, Rio's strategy chief said on Sunday.

* But Rio's largest institutional shareholder has expressed concern about deal, the Wall Street Journal reported on Friday.

MARKET NEWS

* The yen rose against other major currencies on Monday after finance ministers from the Group of Seven (G7) made no specific reference to strength in the Japanese currency at a weekend meeting.

* Japan's Nikkei stock average fell 0.3 percent on Monday, pressured down after data showed the country's economy shrank sharply and the yen rose, leading to slides in Canon Inc and other exporters.

* Australian benchmark S&P/ASX 200 index fell almost 1 percent on Monday. The commodity-intensive index was pulled down by the country's largest bank after banking shares slid on Wall Street.

DATA/EVENTS

* The following data is expected this week:

- Feb 16 US Presidents Day market holiday

- Feb 17 China interim trade data for Jan

- NAHB housing data

- President Obama expected to sign stimulus bill

- Feb 18 US import/export prices Jan

- US industrial production for January

- US housing starts for January

- Feb 19 US producer prices index for Jan

- US leading indicators

- Fen 20 US consumer price index for Jan

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