* Copper stocks in LME warehouses drop further to 311,225 T * China markets closed until Friday * Coming up: U.S. ADP employment for January at 1315 GMT (Updates prices, adds comment, detail; previous SYDNEY) By Harpreet Bhal LONDON, Feb 5 (Reuters) - Copper prices rose on Wednesday, rebounding from two-month lows hit in the previous session, boosted by encouraging factory orders data from the United States overnight and limited short-term availability of the metal in the physical market. New orders for U.S. factory goods outside the volatile transportation sector rose for a third month in December, easing concerns about an abrupt slowdown in manufacturing. Meanwhile data showing dwindling supplies of copper stocks, which raised concerns about immediate availability, also lent support to prices. The figures showed stocks in LME-registered warehouses are at their lowest level in a year at 311,225 tonnes. MCUSTX-TOTAL Three-month copper on the London Metal Exchange rose to $7,056 a tonne at 1117 GMT, up from a close of $7,041 on Tuesday. The metal used in power and construction dropped to its lowest level since Dec. 4 at $7,016 in intraday trade on Tuesday, but a late-session rebound helped it avert a 10-session losing streak, which would have been its longest losing streak in 37 years. Prices have fallen 4 percent since January. Investors are likely to focus on the U.S. ADP employment data due later this afternoon for signs of the country's economic health ahead of the key non farm payrolls data scheduled for release on Friday. The ISM non manufacturing PMI data is also due later in the session on Wednesday. U.S. hiring likely snapped back from a three-year low in January and kept the unemployment rate steady at 6.7 percent, which could ease investors' fears the economy is slowing sharply. "Disheartening economic data (from China) and emerging market crisis are weighing on copper demand, but the metal is finding some relief this morning as many traders are booking profits ahead of the ADP data," said Naeem Aslam, chief markets analyst at Ava Trade. Markets in China, the world's largest copper consumer, will remain closed until Friday for the Lunar New Year holiday. Recent soft factory data from the country has prompted caution about the outlook for economic growth and copper demand. "Looking at the global growth backdrop, things are going to improve (for metals demand) led by the U.S.," said Thomas Lam, chief economist at DMG & Partners Securities in Singapore. "But despite a pick-up in the G3 of the U.S., China and Japan, it's still a sub-par performance. It (the pick-up) will probably limit the downside, but it's unlikely to add too much to commodity prices in general," he added. In industry news, the head of smelting firm PT Indosmelt said Indonesia's government must provide tax holidays and other financial incentives to convince companies to invest hundreds of millions of dollars to build copper smelters amid weak global prices. Mining major Newmont Mining Corp expects normal mining operations to continue at its copper-gold mine in Indonesia for at least the next two months, while it tries to resolve an impasse with the government over copper concentrate exports, Chief Executive Gary Goldberg said.

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