Copper futures rose in New York as Goldman Sachs Group Inc., one of Wall Street’s leading commodity traders, advised investors to buy the metal.

Goldman Sachs also recommended buying zinc and crude oil, saying economic growth will probably be strong enough to tighten some markets with supply constraints in the second half, leading prices to climb. JPMorgan Chase & Co. said copper is “well supported” and “will not collapse.” Yesterday, the metal had the biggest drop in almost two weeks.

“We believe that current copper-price levels offer an attractive opportunity to establish long positions in the metal,” Goldman Sachs analysts, led by the London-based head of commodity research Jeffrey Currie, said today in a report.

Copper futures for July delivery advanced 2.15 cents, or 0.5 percent, to $4.013 a pound at 1:12 p.m. on the Comex in New York. Yesterday, the metal fell 3.2 percent, the most since May 11.

Futures have dropped 14 percent from a record $4.6575 a Feb. 15, partly on concern that interest-rate increases in China, the world’s biggest consumer of industrial metals, will curtail demand.

“The question is not if Chinese consumption will grow by 12 percent or 9 percent, but that it is growing,” Christian Schirmeister, an executive director of JPMorgan Chase Bank N.A., said today at a conference in Singapore. “China physical demand is finally beginning to show up in the nearby spreads, although the volumes still are soft.”

On the London Metal Exchange, copper for delivery in three months gained $67, or 0.8 percent, to $8,861 a metric ton ($4.02 a pound). Aluminum, lead, nickel, zinc and tin also advanced.

To contact the reporter on this story: Maria Kolesnikova in London at [email protected]

To contact the editor responsible for this story: Claudia Carpenter at [email protected].

Source: http://www.bloomberg.com/news/2011-05-24/copper-rises-as-goldman-sachs-recommends-buying-on-demand-growth.html