* LME copper up 3.2 pct, Shanghai copper limit up, zinc up over 5 pct * Italy, Greece appoint new leaders to head bailout plans * Japan's recession ends as quake scars heal * China bank loans spike in Oct, shows selective loosening * U.S. CFTC commitment of traders data Weekly; 2030 GMT (Updates prices, adds quotes, details) By Carrie Ho SHANGHAI, Nov 14 (Reuters) - Shanghai copper hit its daily upper trade limit of 58,780 yuan ($9,267.79) on Monday after Greece and Italy appointed new leaders and seem on track to roll out austerity measures to avert a euro zone and global financial meltdown. Japan's rebound from its earthquake-triggered recession in the third quarter, and China's selective policy easing in October, also boosted investor confidence. The most-active January copper contract on the Shanghai Futures Exchange resumed trading shortly after hitting its limit up, paring 350 yuan to close the session at 58,430 yuan. Three-month copper on the London Metal Exchange rose 3.2 percent to $7,880.50 a tonne by 0708 GMT, after rising 2.2 percent previously. "Copper's performance today is mostly due to the shot of confidence from the euro zone over the weekend. The region seems to be tackling the debt crisis with more eagerness as Italy and Greece appointed new leaders to push through austerity measures," said CRU analyst Qu Yi. The Italian Senate approved a new budget law, clearing the way for approval of the package in the lower house on Saturday and the formation of an emergency government to replace that of Prime Minister Silvio Berlusconi. In Athens, former European Central Bank policymaker Lucas Papademos was sworn in as Greek prime minister after days of political wrangling and tasked with meeting the terms of a bailout plan to avert bankruptcy. Asian stocks rose in response, while the most active Shanghai February zinc contract soared above 5 percent. Japan's economy grew 1.5 percent in the period from July to September from the previous quarter, ending nine months of contraction. Exports and consumption rebounded from a slump caused by the March earthquake, government data showed on Monday. "Sentiment in China has also been boosted by news of a sharp jump in new bank loans in October. This shows that the government is taking flexible measures to loosen monetary policy here," said China Futures Co. analyst Yang Jun. Chinese banks wrote 587 billion yuan of new loans in October, much more than expected and a sharp jump from September, evidence of "selective" policy easing by the government to keep the world's second-largest economy on an even keel. Americans became more hopeful about the U.S. economic outlook in November, pushing consumer sentiment to a five-month high, though they still have a gloomy view of personal finances, a survey released on Friday showed. But some analysts advised caution, warning that the session's improved sentiment may be temporary. "This copper rally may be short-lived, as we are seeing a slowing of physical spot trade in Guixi," said Zhang. "For a while, there had been a backwardation of up to 1,000 yuan against the ShFE January contract, but now this has flattened out." Traders also warned the market's positive reaction to the euro zone hinged on how it received Italy's planned sale of 3.0 billion euros of five-year bonds on Monday. Political turmoil in Italy and Greece is also complicating efforts to increase the firepower of the euro zone's bailout vehicle to 1 trillion euros, an official at the European Financial Stability Facility said on Friday. Base metals prices at 0708 GMT Metal Last Change Pct Move YTD pct chg LME Cu 7880.50 241.50 +3.16 -17.91 SHFE CU FUT JAN2 58430 2820 +5.07 -18.68 LME Alum 2189.00 17.00 +0.78 -11.38 SHFE AL FUT JAN2 16320 180 +1.12 -3.09 HG COPPER DEC1 356.15 9.80 +2.83 -19.78 LME Zinc 1960.00 40.00 +2.08 -20.13 SHFE ZN FUT FEB2 15430 655 +4.43 -20.77 LME Nickel 18452.00 352.00 +1.94 -25.45 LME Lead 2035.00 40.00 +2.01 -20.20 SHFE PB FUT 15520 610 +4.09 -15.42 LME Tin 22100.00 175.00 +0.80 -17.84 LME/Shanghai arb 87 Shanghai and COMEX contracts show most active months ^ LME 3-m copper in yuan, including 17 pct VAT, minus SHFE third month ($1=6.342 Chinese Yuan) (Reporting by Carrie Ho; Editing by Clarence Fernandez)

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