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Copper prices rebounded overnight from more than three-year lows as coronavirus cases dropped in China and nations around the world geared up to pump stimulus into their economies.

Other industrial metals also bounced, along with oil and equity markets, with the United States and Japan among those announcing plans to counter the impact of the virus and support economic growth.

Also lifting sentiment was a visit by Chinese President Xi Jinping to the outbreak epicentre in the central city of Wuhan after a sharp drop in new cases in mainland China in the past week.

“We’re relatively confident that we’ve seen the bottom (for prices), but it will depend on whether we see a second (virus) break-out in China or any real deterioration in the numbers for the Western world,” said analyst Timothy Wood-Dow at BMO Capital in London.

“China seems to be gearing up for a big amount of stimulus. That will be in the form of infrastructure investment, which is base-metals heavy, and will really hit the economy later in the year.”

Wood-Dow said the stimulus in top metals consumer China was expected to total around 6-8 trillion yuan, equivalent to around 8 per cent of GDP.

Benchmark three-month copper on the London Metal Exchange gained 0.6 per cent to $US5,566 a tonne in final open-outcry trading after sinking to $US5,433 on Monday, the weakest in more than three years.

LME zinc has the largest net speculative short position on the exchange at 34 per cent of open interest, the highest since November 2015, based on data from Friday, according to estimates by broker Marex Spectron.

LME zinc shed 0.2 per cent to close at $US1,976 a tonne.

Factories in China slowly coming back online raised hopes of an uptick in demand.

“In China, the semi-fabricator industry is improving slowly,” CRU Group analyst He Tianyu said, adding that demand from the construction and infrastructure sectors was also improving, albeit at a slower pace.

The utilisation rate at copper semi fabricators, which process the metal into products such as wire-rod or tubes, has picked up to 60 per cent from 40 per cent-50 per cent a week earlier as more people return to work, the analyst added.

Business and travel activities are steadily recovering in China, but rapidly rising infections globally will pose a challenge to the country’s broader economic resumption.

Copper output at Codelco, the world’s top copper miner, plunged 6.8 per cent in January from a year earlier while production at BHP’s Escondida, the world’s largest copper mine, rose 10 per cent.

LME aluminium rose 0.6 per cent to finish at $US1,697 a tonne, lead dipped 0.3 per cent to $US1,795, nickel edged up 0.2 per cent to $US12,680 and tin advanced 1.1 per cent to 16,875.