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If you just considered how uncertain things are right now, you might think that news coming out of China regarding its economy was still very soft. Data over the weekend showed China’s November industrial production gains of 10.1%, which is the highest reading since March. Higher production and higher copper demand are good leading indicators.

Copper futures have hit the highest prices in seven weeks now, with Comex March futures prices up 1.4% at over $3.71 per pound. If China has about 40% of global copper demand, then higher industrial production would drive up demand in theory. The other good news out of China was that its consumer prices rose only 2% in November, meaning that inflation is in check.

It is somewhat interesting that Southern Copper Corp. (NYSE: SCCO) is not responding much more positively, perhaps because shares rose from $36 last week to $38.25 today. Freeport-McMoRan Copper & Gold Inc. (NYSE: FCX), still reeling from analyst downgrades after last week’s unpopular acquisition, is down another 0.4% at $31.60 today, but we do not believe its share price is going to react just to metals prices for the time being.

We are seeing a gain in the iPath DJ-UBS Copper TR Sub-Idx ETN (NYSEMKT: JJC), as the key exchange-traded product that tracks copper, with a gain of 1.3% to $46.83, against a 52-week range of $21.61 to $51.41. An ETF that tracks copper miners is the Global X Copper Miners ETF (NYSEMKT: COPX), but that is thinly traded and only up one cent at $12.95, against a 52-week range of $10.30 to $15.82.

If China wants to stimulate its economy further, and its inflation rates are low, that will not prompt the giant nation put the skids on copper demand in the immediate future. Now if we can just get past the coming fiscal cliff.

JON C. OGG