* Gold, U.S. oil jump the most in 2 weeks
* Hopes Europe taking concrete steps to solve debt crisis
* Coming Up: U.S. new home sales; 1500 GMT (Updates prices, changes dateline and byline)
LONDON, Nov 28 (Reuters) - Oil, gold and copper rallied on Monday, boosted by the strength of the euro, which gained from expectations that Europe will take decisive steps this week to resolve the debt crisis.
Copper at one stage rose more than 3 percent, its biggest single-day increase in a month, while U.S. crude and gold gained the most in about two weeks, after sentiment was boosted by a media report suggesting the International Monetary Fund was preparing a rescue plan worth up to 600 billion euros ($796 billion) for Italy.
Commodities held on to gains even after the IMF said it was not in discussion with the Italian authorities on a financing plan, while the euro rose by 1 percent against the dollar .
"What appears to be going on is that there are clear moves within Europe and a recognition that some sort of closer fiscal integration is necessary. Quite how you get to it from where we are now, I think remains very difficult," said Nic Brown, analyst at Natixis.
A weaker U.S. currency makes it cheaper for non-U.S. investors to buy dollar-priced assets. Against a basket of major currencies, the dollar was down 1 percent on the day.
Three-month copper on the London Metal Exchange was up nearly 3 percent at $7,430 a tonne by 1155 GMT, set for its largest daily gain since late October. Copper has lost around 12 percent in the past four weeks.
Spot gold rose 1.9 percent to $1,712.00 an ounce, its biggest single-day rise since Nov. 11.
Other precious metals tracked bullion's gains, with silver rising more than 3 percent, palladium up by more than 4.5 percent and platinum gaining nearly 2 percent.
RELIEF RALLY
Finance ministers from the euro zone are meeting on Tuesday when they are expected to approve detailed operational rules for the euro zone's bailout fund, which will clear the way for the 440 billion euro facility to attract cash from private and public investors to its co-investment funds in coming weeks.
Hopes that Europe will come up with concrete steps to activate the euro zone bailout fund also sent Asian shares higher while the euro pared gains after the IMF said there were no talks with Italy for a financing plan.
"Commodities are up on short-covering as players who had been anticipating a deepening crisis and relentlessly avoided risks are relieved somewhat by signs European leaders are now moving with an elevated sense of urgency to catch up with the speed of market turmoil," said Koichiro Kamei, managing director at financial research firm Market Strategy Institute in Tokyo.
Analysts said reports of record-breaking sales over the Thanksgiving weekend in the United States were also helping support the markets.
U.S. retailers racked up a record $52.4 billion in sales over the long weekend, a 16.4 percent jump from a year earlier, as early hours and attractive promotions brought out shoppers, an industry trade group said on Sunday.
The euro zone debt crisis and a struggling U.S. economy had deterred appetite for riskier assets over the past months because they dented the outlook for raw material demand.
For the year, the Reuters Jefferies CRB index -- a measure of 19 commodities -- is down more than 8 percent, its first annual decline since 2008.
Oil rose sharply on Monday with U.S. crude futures climbing towards $100 per barrel as concerns of a supply disruption from the Middle East overshadowed worries over oil demand growth and a worsening economic outlook for the euro zone.
Brent crude futures for January rose $2.50 per barrel to $108.90. U.S. oil's rise was even stronger, boosted by a healthy start to U.S. consumer spending ahead of the key year-end holiday season, with prices up $3.03 to a high of $99.80.
"Tension with Iran and talk of a European ban on Iranian oil is raising concerns of supply problems," said Christophe Barret, global oil analyst at Credit Agricole. "There is also some optimism over talk of a closer fiscal union among core euro zone states, although this would be a long way away."
In the grains market, U.S. soybeans recovered from a 13-month low, while corn and wheat gained around 1 percent.
Investors are expecting China, the world's top soybean buyer and No. 2 corn consumer, to step up imports as prices of agricultural products slide to multi-month lows. ($1 = 0.7536 euros) (Additional reporting by Maytaal Angel, Harpreet Bhal and Christopher Johnson in LONDON and Lewa Pardomuan and Naveen Thukral in SINGAPORE; Editing by Anthony Barker)
