LME copper closed at $7,144/mt on Tuesday, up almost 4%. Aluminium peaked at $2,138/mt, and nickel soared to a 7-month high of $20,345/mt.

"I think we are still seeing some residual demand from last week," said Catherine Virga, senior base metals analyst with CPM Group in New York. "We are pulling up from that correction. We are seeing an uptick in physical demand across the metals due to the lower prices."

"The demand picture out of China is still robust," said Daniel Smith, an analyst at Standard Chartered. "Once China comes back from the New Year holidays things will pick up and this rebound is an anticipation of that."

Closing LME prices for Tuesday:

Copper    $7,144  +$274

Aluminium $2,131   +$77

Zinc      $2,337  +$137

Lead      $2,298  +$118

Tin      $16,700  +$205

Nickel   $20,325  +$975