Copper rose after China stocks rallied by the most in a year, boosting the demand outlook in the biggest user amid speculation that the government will provide more financial support to the equity market. The metal for three-month delivery on the London Metal Exchange rose as much as 1.4 percent to $7,394.50 a metric ton, and traded at $7,359 a ton by 3:41 p.m. Shanghai time. The contract fell as much as 1.7 percent to $7,163 a ton earlier. December-delivery futures on the Shanghai Futures Exchange closed 1.3 percent higher at 54,930 yuan ($8,624) a ton. “The surge in stocks prompted speculative intraday buying in base metals, spurring shorts to cover their positions quickly,” Wang Mingyi, an analyst at Galaxy Futures Co., said by phone from Beijing. “Copper is directionless now, and is easily moved by outside markets.” The benchmark Shanghai Composite Index surged by as much as 3.1 percent, the most since October 2010, on speculation the government will provide more financial support to equities after valuations dropped to record low levels. Banks led the rally. State-run investment arm Central Huijin Investment Ltd. bought 14.6 million Shanghai-listed A shares in Industrial and Commercial Bank of China Ltd., 7.38 million yuan-denominated shares of China Construction Bank Corp., 39.1 million shares in Agricultural Bank of China Ltd. and 3.5 million shares in Bank of China Ltd., the four lenders said in separate statements to the Hong Kong and Shanghai stock exchanges. Mine Expansion BHP Billiton Ltd. (BHP) has approved $1.2 billion for initial work on the proposed expansion of the Olympic Dam expansion project in Australia that would more than quadruple copper production in 30 years, making it the world’s largest uranium mine, according to an exchange filing today. Aluminum was little changed at $2,229 a ton. Alcoa Inc. Chief Executive Officer Klaus Kleinfeld said the company has raised its forecast for Chinese aluminum demand to 17 percent for this year. Demand will exceed supply by 800,000 tons in the largest consumer, he said yesterday during the company’s third- quarter earnings conference call. Zinc climbed 1.9 percent to $1,945.50 a ton, and lead advanced 1.1 percent to $2,007 a ton. Nickel gained 0.9 percent to $19,035 a ton, and tin rose 0.8 percent to $22,575 3:05 p.m. Shanghai time. To contact the editor responsible for this story: Richard Dobson at rdobson4@bloomberg.net

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