By Glenys Sim Oct. 6 (Bloomberg) -- Copper, zinc and aluminum plunged by the exchange-imposed daily limit in Shanghai, catching up with losses on international markets in the past week when China's exchanges were closed for holidays. London Metal Exchange copper slumped 11 percent last week, and futures in New York tumbled 13 percent on concern a $700 billion financial rescue plan won't prevent a U.S. recession, dragging down global demand. ``Prices have been driven lower by a deterioration in the outlook for demand growth in most countries over the past three months,'' Macquarie Group Ltd. analysts led by Jim Lennon wrote in a report today. ``The downward revisions appear to be larger for European and Chinese demand, which were previously expected to hold up relatively well compared to the U.S.'' Copper for December delivery on the Shanghai Futures Exchange dropped by 2,140 yuan, or 4 percent, from the previous settlement price, to 51,210 yuan ($7,481) a metric ton when the exchange opened for trading at 9 a.m. local time. December-delivery zinc and aluminum in Shanghai also fell by the 4 percent limit to 13,670 yuan and 14,905 yuan a ton respectively. Commodities tumbled the most in more than 50 years last week amid weak economic data in the U.S. and Europe. Employers in the world's largest economy cut jobs by the most in five years in September, manufacturing in the U.K contracted at the fastest pace in 16 years last month, while France slipped into a recession in the third quarter for the first time in 15 years. Euro Declines Raw materials also fell after the euro slid to a 13-month low against the dollar as the deepening credit crunch forced European governments to pledge bailouts of troubled banks and increase protection for depositors. ``There is no doubt that the deterioration in global demand expectations is resulting in an increase in the likelihood that the copper market will move into more significant surplus over the next 6 months,'' the Macquarie analysts said. Inventories in warehouses monitored by London Metal Exchange declined 0.3 percent to 198,500 tons on Oct. 3, and reserves in Shanghai warehouses fell 5.5 percent to 16,130 tons before the holidays. If Shanghai copper prices hold up ``relatively well'' then the arbitrage will open up and Chinese traders may buy LME copper to deliver into Shanghai, keeping global stockpiles low for the time being, said Lennon. ``Regardless, the copper arbitrage points to a pickup in Chinese imports over the next two months,'' he said. Copper for delivery in three months on the London Metal Exchange lost as much as 3.8 percent to $5,780 a ton, and December-delivery copper on the Comex division of the New York Mercantile Exchange fell as much as 3.5 percent to $2.596 a pound as of 10:11 a.m. Singapore time. Among other LME-traded metals, aluminum dropped 1.3 percent to $2,308 a ton, zinc was down 0.3 percent at $1,590, lead fell 2.3 percent to $1,680, and nickel lost 0.3 percent to $15,105. To contact the reporter for this story: Glenys Sim in Singapore at gsim4@bloomberg.net

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