* SHFE aluminium, zinc stocks rise, copper falls slightly
* U.S. hikes duty on some aluminium products
* COMING UP: U.S. 3Q GDP, October ISM at 1230 GMT
(Adds analyst comment, updates prices, previous dateline SINGAPORE)
By Melanie Burton
LONDON, Oct 29 (Reuters) - Base metals fell on Friday and copper touched a three-week trough, as markets cut risk and investors turned cautious ahead of next week's pivotal Federal Reserve meeting and the dollar steadied.
Three-month copper on the London Metal Exchange was trading at $8,168.75 a tonne at 1019 GMT, having earlier fallen to $8,140 -- its lowest since Oct. 8 -- compared with $8,340 at the close on Thursday.
The metal used in power and construction, rallied 6.7 percent over October to peak at $8,549, its highest since July, 2008, having advanced some 11 percent this year.
Aluminium, tin and nickel sank to their lowest in around a month while zinc and lead fell by some four percent at one stage.
"They (base metals) are under pressure -- it's the usual suspects, a slightly firmer U.S. dollar, weaker equity markets in Asia, and some profit-taking ahead of the Fed meeting next week," said Commerzbank analyst Daniel Briesemann.
The main market focus remains what the Fed decides at its meeting on Nov. 2-3, with U.S. growth data on Friday potentially feeding into the debate over how big Fed asset-buying should be this time around.
Any move that weakens the dollar may lift industrial metals, as a softer dollar makes commodities cheaper for holders of other currencies.
Major currencies were broadly in the ranges as investors wait to see if the Fed says next week that it will resume quantitative easing as many expect, and if so, on what scale and over what period.
Meanwhile, European shares fell slightly with miners weaker on lower metals prices and traders also on the defensive.
Fundamentally, a slowdown in the pace of inventory withdrawals suggest demand for the metals may be moderating, added Briesemann.
"There are increasing signs that demand momentum is coming down at current high price levels. It can be seen in increasing inventories, especially in Shanghai," he said.
Stocks of zinc and aluminium in warehouses registered with the Shanghai Futures Exchange grew this week, although copper stocks dipped slightly, data showed.
The stream of U.S. results today that could impact the price of industrial metals via currencies include U.S. Q3 GDP, while the Institute for Supply Management releases the October index of regional business activity at 1230 GMT.
After that the ISM Chicago October manufacturing index is due at 1345 GMT and the University of Michigan Consumers sentiment for October at 1355 GMT.
STOCKS INCREASE
LME inventories of copper rose by 475 tonnes, the latest data showed, with total inventories at 368,500 tonnes, reflecting a slowdown in the pace of decline. However, LME stocks have still fallen by a third from cycle highs above 555,000 tonnes in mid-February
Inventories of tin and zinc also grew, data showed. Zinc stocks have jumped by over 15,000 tonnes into New Orleans this week.
Lead inventories fell, data showed, but remain close to eight-year highs, while exchange stocks of nickel are expected to reach record highs towards the end of the year. A trader said that most industry is well supplied with metal, and will want to keep low levels of inventories over the end of the year, which will curb demand for physical metal.
"Most people are telling me they are well equipped to the end of first half next year. For the physical guys, all you will see is adjustments to their physical intake. They will be very cautious running stocks over the year end," the trader said.
Elsewhere, markets are still watching developments in Chile, for news of a potential strike.
Union workers at Chile's giant Collahuasi mine on Thursday geared up for wage negotiations at the world's No. 3 copper mine. Chilean output accounts for around one third of total mined copper production.
Aluminium fell to $2,305, its lowest since October 1, and was at $2,321 per tonne, down from $2,347. The United States on Thursday slapped an additional 59.31 percent duty on imports of a key aluminium product from China.
The trader said it is unlikely to immediately impact the market as orders are winding down for the year end.
Nickel at $22,766 a tonne, from a bid of $23,100. It earlier fell as far as $22,661, a one-month low.
LeadAT $2,430 a tonne was down some 3 percent from $2,505.50, while zinc fell before steadying at $2,410 per tonne, a decline from $2,494 on the close.
Tin tumbled to $25,050 per tonne at one point, its cheapest since Oct. 5 before settling at $25,400, down from $26,250.
Metal Prices at 1019 GMT Comex copper in cents/lb, LME prices in $/T and SHFE prices in yuan/T Metal Last Change Percent Move End 2009 Ytd Percent
move COMEX Cu 371.75 -7.00 -1.85 334.65 11.09 LME Alum 2330.00 -17.00 -0.72 2230.00 4.48 LME Cu 8320.00 -20.00 -0.24 7375.00 12.81 LME Lead 2495.00 -10.50 -0.42 2432.00 2.59 LME Nickel 23000.00 195.00 +0.86 18525.00 24.16 LME Tin 26000.00 -250.00 -0.95 16950.00 53.39 LME Zinc 2490.00 -4.00 -0.16 2560.00 -2.73 SHFE Alu 16420.00 -5.00 -0.03 17160.00 -4.31 SHFE Cu* 62400.00 -1300.00 -2.04 59900.00 4.17 SHFE Zin 19385.00 -945.00 -4.65 21195.00 -8.54 ** Benchmark month for COMEX copper * 3rd contract month for SHFE AL, CU and ZN SHFE ZN began trading on 26/3/07
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(Reporting by Melanie Burton, editing by Sue Thomas)