What happened

Shares in copper miner Freeport-McMoRan (FCX 0.52%) were up by more than 8% by early afternoon today. In general, it was a good day for cyclical mining stocks -- usually a sign that the market is taking a positive view of the economic growth outlook. That said, there are some stock-specific reasons why Freeport outperformed, and they come down to management's commentary around the company's third-quarter earnings released the day before. 

The results themselves brought few surprises; after all, investors can see where the price of copper is in the market and therefore ascertain the trend in Freeport's revenue. However, management's discussion of current market conditions and growth prospects was telling. 

During the earnings call, CEO Richard Adkerson talked of the physical copper market being "strikingly tight globally right now" and customers "fighting" to get hold of products. Meanwhile, CFO Kathleen Quirk said copper demand remained healthy and "inventories remain low by historical levels."

All of this speaks to a physical market dislocated from the doom and gloom expressed in the falling price of copper. It appears that financial market speculators have taken a bearish view on the price of copper, but underlying demand remains robust.

So what

If the conditions outlined by Freeport's management continue, the upward price pressure is likely to increase copper prices. Alternatively, the financial investors may be right to sell off copper in anticipation of a collapse in demand. 

The latter scenario is possible, but management's commentary on current market conditions boosts the stock. It also supports the idea that long-term demand for copper, driven by demand from electric vehicles and the electrification trend in the economy, means investing in copper stocks is a no-brainer. 

Now what

Wait and see. If the economy falls off a cliff, then all bets are off, and Freeport will suffer alongside the rest of the market. However, current physical market conditions remain favorable, and the dip in the price of copper and Freeport's stock price could prove an attractive entry point into a long-term growth story.