Copper prices rebounded from a four- year low on speculation demand for the metal will pick up in 2009 as the U.S. economy climbs out of a recession. Before paring gains, U.S. equities rallied after GMAC LLC converted to a bank, boosting speculation that financing for consumer loans may ease. Copper, used in pipes and wires, has plunged 57 percent this year as the Standard & Poor’s 500 Index tumbled 41 percent amid the first U.S. recession since 2001. “Copper is a bellwether for the economy,” said Frank McGhee, the head dealer at Integrated Brokerage Services in Chicago. “Copper can drift higher with U.S. stocks, but another wave of bad economic news can send copper to under $1 a pound.” Copper futures for March delivery rose 2.95 cents, or 2.3 percent, to $1.3035 a pound on the Comex division of the New York Mercantile Exchange. Earlier, the price touched $1.255, the lowest for a most-active contract since Oct. 29, 2004. The metal dropped 1.7 percent this week. The Comex and the London Metal Exchange were closed yesterday for the Christmas holiday, and the LME was shut today. The seven-day relative-strength index for copper futures fell below 30 in the previous two trading sessions, a signal to technical traders that prices are headed higher in the short term. Copper still is headed for the first annual decline since 2001. The metal may average $1.34 a pound in 2009, Goldman Sachs Group Inc. analysts led by Jeff Currie, the head of commodities research, said in a Dec. 11 report. Banks worldwide have posted more than $1 trillion in losses and writedowns since the second quarter of 2007 as the credit crisis deepened. Recessions in the U.S., Europe, and Asia have reduced demand for industrial metals. Factory output in Japan plunged 8.1 percent in November from October, more than the 6.8 percent estimated by economists. The jobless rate climbed to 3.9 percent from 3.7 percent. Household spending slid 0.5 percent, a ninth drop.

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