* China new home prices rebound nationwide
* Demand weakness, rising supplies limit copper’s gains
* Coming Up: U.S. Philly Fed business index for June at 1400 GMT (Updates with official midday prices)
By Maytaal Angel
LONDON, June 18 (Reuters) - Copper climbed on Thursday on upbeat Chinese data and as the dollar fell sharply on shifting expectations for a U.S. rate rise, but gains were limited by expected seasonal demand weakness and rising supplies.
New home prices in China rebounded nationwide for the first time in 13 months in May, suggesting a property downturn is bottoming out after a barrage of stimulus measures from the central bank and local governments.
Also, the Federal Reserve signalled on Wednesday that U.S. interest rates would rise more slowly than markets had expected, sending the dollar index to a month low and boosting the allure of metals for buyers holding other currencies.
Still, the Fed’s caution and a potential Greek euro zone exit underscored global economic risks to copper demand, at a time when supplies are rising and concerns abound over a growth slowdown in top user China. MCU-STOCKS CU-STX-SGH
“Copper’s underlying position is still one of surplus and the risk is that in the (seasonally) quieter third quarter you’ll see further increases in exchange stocks,” said BNP Paribas strategist Stephen Briggs.
Three-month copper on the London Metal Exchange traded up 0.6 percent to $5,779 a tonne in official midday rings, having plumbed a new 3-month trough at $5,728 a tonne in the previous session.
Copper has shed some 10 percent since early May, largely over worries about weak demand in China.
Beijing has however continued to roll out measures to support the Chinese economy, brightening the outlook for metals medium term.
China will step up “effective investment” in key sectors, including shantytown renovation and rural power infrastructure, to support growth, the cabinet said, even as it saw more positive factors in the economy.
LME zinc was last bid up 0.9 percent in rings to $2,096 a tonne while lead was last bid up 1.4 percent to $1,827 a tonne.
The global zinc market surplus fell to 5,400 tonnes in April from a revised 20,500 tonnes in March, while the global lead market had a deficit of 17,000 tonnes in April after a revised surplus of 5,700 tonnes in March, the latest industry data showed.
Aluminium traded up 0.8 percent to $1,718 a tonne, but the metal has lost nearly 13 percent since early May.
Surcharges for physical aluminium have settled close to equilibrium levels after tumbling by up to three-quarters this year, supported by consumer buying and more attractive conditions for financing deals.
Tin was last bid up 1.7 percent to $15,000 a tonne, while nickel was up 0.8 percent at $12,850 a tonne.
Three month LME copper
Most active ShFE copper
Three month LME aluminium
Most active ShFE aluminium
Three month LME zinc
Most active ShFE zinc
Three month LME lead
Most active ShFE lead
Three month LME nickel
Most active ShFE nickel
Three month LME tin
Most active ShFE tin ($1 = 6.2075 Chinese yuan) (Additional reporting by Melanie Burton, editing by David Evans)