LONDON, Jan 2 (Reuters) - Copper prices hovered around five-month lows as expectations of a deteriorating demand outlook were reinforced by weak manufacturing activity around the world, offsetting support from a weaker dollar.
Benchmark copper on the London Metal Exchange (LME) was up 0.1% at $8,775 a metric ton by 1107 GMT, having touched $8,757 on Tuesday for its lowest since Aug. 8.
A weaker U.S. currency makes dollar-priced metals cheaper for buyers holding other currencies. However, traders expect the dollar to strengthen again in the coming days, resuming a climb that has weighed on metal prices since the end of September.
Industrial metals are also expected to come under pressure from uncertainty created by the prospect of U.S. President-elect Donald Trump imposing tariffs on imports, which could start a trade war and hit global economic growth and demand.
"There is a lot of nervousness about what Trump will do when he arrives at the White House," one copper trader said. "Manufacturing activity and demand aren't picking up."
Surveys of purchasing managers showed manufacturing activity slowing in China and South Korea in December while European factory activity declined at a faster rate than in November.
Aluminium touched a 2-1/2 week peak at $2,574.50 a ton on worries about supplies on the LME market. It was last up 0.3% at $2,560.
This concern has narrowed the discount for the cash contract over three-month aluminium to around $19 a ton from more than $40 in December.
Aluminium stocks in LME-registered warehouses are down more than 40% since May last year at 634,650 tons.
Cancelled warrants -- metal earmarked for delivery -- at 54% of the total suggest more aluminium is due to leave LME warehouses over the coming days.
On the technical front, upside resistance for aluminium is around $2,575 a ton, the 21-day moving average, with support at the 100-day moving average of $2,553.
In other metals, zinc lost 1% to $2,950 a ton, lead eased by 0.1% to $1,950, tin fell 1.2% to $28,725 and nickel was down 0.8% at $15,210.