NEW YORK (AP) — Shares of Alcoa Inc. rose Tuesday after a J.P. Morgan analyst upgraded the aluminum producer on a forecast that a worldwide surplus of the metal will shrink. Alcoa has struggled with low prices for aluminum since the financial crisis of 2008, as overproduction in China has contributed to a glut. In the fourth quarter, the company was paid about 7 percent less for aluminum than it got a year earlier. J.P. Morgan analyst Michael Gambardella said in a report Tuesday that aluminum markets are tightening after capacity cutbacks. He lifted his rating on the stock to "overweight" — equivalent to a "buy" rating — from "neutral" and raised his target price for the shares to $15 from $9 . In midday trading, Alcoa shares rose 93 cents , or 8.1 percent, to $12.29 . The stock had gained about 26 percent over the past 12 months. Alcoa has been countering weak prices by idling aluminum-smelting plants and shifting more of its business into producing rolled sheet aluminum and products used to make airplanes and autos. This month, the New York -based company reported a $2.34 billion fourth-quarter loss as it took huge charges to write down the value of acquisitions it made more than a decade ago. But its 5 percent decline in revenue was less severe than analysts had expected.
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