* Dubai worries fade; China PMI data point to strong 2010 * Copper on course for biggest annual gain in at least 30 yrs * Oil heading for strongest annual gains in a decade * http://graphics.thomsonreuters.com/129/MKT_GLD$OIL1209.gif By Nick Trevethan SINGAPORE, Dec 1 (Reuters) - Commodity markets were steady on Tuesday, wafted either side of their previous closing values by the dollar as worries about Dubai's debt problems faded and business activity in China remained strong. Sentiment saw support from data showing China's economy is ending the year on a strong note, laying the foundations for solid expansion in 2010, An index produced for HSBC, based on a poll of purchasing executives in manufacturing, hit a record high in November, while a parallel official index was unchanged at an 18-month peak. Together, the surveys showed that the world's third-largest economy has largely recovered from the global downturn thanks to aggressive pro-growth measures adopted a year ago. Mingchun Sun, Nomura's chief China economist, said the report suggested year-on-year gross domestic product growth this quarter was on track to reach his forecast of 11 percent. With manufacturing gaining further steam, Qu Hongbin, chief China economist with HSBC, said he expected Chinese domestic product to grow by more than 10 percent this quarter compared with a year earlier. "This, combined with the latest policy statement with more emphasis on quality of growth, means added room for policy makers to redirect fiscal spending from infrastructure investment to pro-consumption areas," Qu said. China's economic expansion through 2009 has been one of the main pillars of the commodities rally which has seen copper rise 126 percent this year and oil 73 percent. Copper is on course for its biggest annual gain since at least 1978, while crude is set for its strongest year since 1999. Three-month copper on the London Metal Exchange was unchanged at $6,930 by 0625 GMT, having rallied 1 percent in the previous session. Oil rose above $77 a barrel after a rebound of 1.6 percent in the previous session, Recent trading activity suggests the market views dips as an opportunity to buy in. On Friday copper fell around $200 to $6,620 on worries Dubai's debt problems heralded a second credit crisis, but it had recovered by the close of trade to $6,855, while crude bounced back from an intraday low of $72.39 a barrel on the same day. "The view is the response to the Dubai debt issues was exaggerated by month-end and U.S. holidays. It won't have an impact on the global recovery," Barclays Capital analyst Yingxi Yu said. In its first statement since the crisis began, Dubai World, the government-controlled holding company at the heart of the storm, said a restructuring would involve $26 billion in debt and mostly affect its property firms, Nakheel and Limitless. But the Dubai government said it was not responsible for the debts of Dubai World, dealing a blow to creditors' assumptions that the emirate would guarantee the conglomerate's liabilities. U.S. crude for January delivery inched down 2 cents to $77.26 a barrel by 0322 GMT. The contract settled up $1.29 at $78.47 on Monday. London Brent crude crept up 3 cents to $78.50. Analysts expect prices to be rangebound in the short term. "We see little impetus for a break to the upside, even if economic indicators surprise to the upside this week," Credit Suisse analysts said in a research note to clients. BULLION BULLS The dollar was little changed versus the euro and a basket of currencies, having fallen in the previous session as investors unwound moves into the safety of the U.S. currency. Gold fell as much as 5 percent on Friday as worries about Dubai's debts spread through markets, sending the dollar higher. Spot gold fell 5 cents $1,179.05 per ounce. "The market is awaiting further developments on currency markets on this news," a Japanese analyst said. But not every analyst was quite so retiring. Euro Pacific Capital's Peter Schiff said gold would hit $5,000 an ounce -- four times higher than current values. Schiff gained some fame last year when his early predictions of the mortgage crisis and the banking industry's collapse proved all too prescient. "I don't think it's just possible -- it is highly likely gold will hit $5,000," he told Reuters in an interview. In grains markets, Chicago corn slid nearly 1 percent as U.S. farmers made progress in harvesting this year's delayed crop, while wheat eased on profit-taking following a rally in the previous session. Soybeans ticked lower as the market eyed favourable crop weather in South America, where farmers have made rapid progress in planting the soy crop. (Editing by Clarence Fernandez) ((nicholas.trevethan@thomsonreuters.com; +65 6870 3822; Reuters Messaging: nicholas.trevethan.reuters.com@reuters.net)) ((If you have a query or comment on this story, send an email to news.feedback.asia@thomsonreuters.com))

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