* Copper up on weak dollar, expectations for a delay in a U.S. rate rise * Falling inventories and output cuts expected to support prices By Mariana Ionova LONDON, Oct 5 (Reuters) - Copper rose on Monday alongside global equity markets after a disappointing U.S. jobs report pushed back expectations for a U.S. rate rise and weakened the dollar. Benchmark copper on the London Metal Exchange traded up 0.7 percent to $5,134 a tonne in official rings. Friday's U.S. non-farm payrolls report showing the world's largest economy added only 142,000 jobs last month has led many to expect the Federal Reserve to delay raising rates until 2016. The weaker greenback supports prices since it makes dollar-denominated commodities cheaper for holders of other currencies. "The market is postponing its expectations of a mid-term rate hike," said Jens Pedersen, senior commodities analyst at Danske Bank. "Generally there is an improvement in risk sentiment in markets this morning." The lift in prices offset persistent concerns about sluggish demand growth in top consumer China, which have recently hit industrial metals. Copper prices fell more than 10 percent in the third quarter, marking their biggest quarterly loss in more than two years. Analysts expect copper to find support over coming months as producers scale back output and inventories fall further. "Basically what we're seeing is the market starting to adapt to a situation with lower growth, lower investment and lower manufacturing activity from China," Pedersen said. "It's setting a floor on prices." Stocks of copper in LME-registered warehouses have fallen about 14 percent to 317,600 tonnes since late August. Positive sentiment for copper however, was partly offset by the falling premium for the cash contract over the three-month future, which at around $11 a tonne from above $17 early last week suggests more availability of metal. Zinc fell 0.5 percent to $1,676 in the rings, while nickel eased 0.5 percent at $9,975 per tonne. Lead and tin were untraded but bids on both dipped 0.2 percent to $1,640 and 0.4 percent to $15,520 a tonne respectively. Three-month aluminium was bid 0.2 percent lower at $1,555.5 a tonne. Oversupply and a market surplus are expected to further weigh on prices. "The steady performance is masking negative fundamentals that are still plaguing the complex," INTL FC Stone said in a note. "Although we continue to see modest cutbacks in the supply chain, these are being made mostly in the West and have yet to make a significant dent in the overall surplus." Global aluminium production grew by 10 percent year-on-year in August, according to figures from the International Aluminium Institute.

Source