Metals Winners: Freeport, BHP Billiton

NEW YORK (TheStreet) -- Whoa, metals.

Chinese economic news has a way of crushing or sparking the share prices of commodities-linked companies, and Wednesday it was the latter, with August manufacturing data from Beijing surprising some with an unexpected strength.

Recently named the second-largest economy in the world behind the U.S., China had caused waves all through this year as its monetary and fiscal authorities wrestled with the problem of cooling down an economy in hyper drive while at the same time avoiding a decline that might spook a fragile global recovery.

There were two China indicators Wednesday. Far from being a decline, the purchasing managers' index, which gauges manufacturing activity, came in at 51.7 in August, up slightly from July's 51.3.

Another survey of such managers, this one conducted by the giant Hong Kong bank HSBC, also demonstrated growth: the measure hit 51.9 in August, the highest such figure in three months. In July, the HBSC survey came in at 49.4. Anything below 50, of course, represents a retraction.

HSBC's chief economist, Hongbin Qu, wrote in his monthly report explaining the data, "This reconfirmed our long-held view that China is moderating rather than melting down."

The entire industrial metals and mining complex responded with vehemence early in Wednesday's trading session. Miners of copper and iron ore, crucial ingredients in China's infrastructure-building spree, were especially lively.

Freeport McMoRan(FCX), whose business has depended on China since the dawn of the recession, saw its shares jump 5.5% to $53.68.