Could US Steel Stocks Regain Momentum in October?
US steel stocks
The US steel industry is having a tepid year. U.S. Steel Corporation (X), AK Steel (AKS), and Nucor (NUE) are trading with year-to-date losses. So far, October has been mixed for US steelmakers (XME). While U.S. Steel Corporation has seen some upwards price action, Nucor and AK Steel have been flat.
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Steel stocks were the frontrunners in “Trump trade” last year. Investors became bullish on the US steel industry, expecting higher steel demand as a result of Trump’s proposed infrastructure investments.
Additionally, and perhaps more importantly, Trump’s resolve to protect US manufacturing from the onslaught of imports was a key driver of investor optimism. Rising global steel prices and raw material prices laid the ground for price hikes by US steel mills last year. Whereas US steel prices continued to gain in 1Q17, they have now given up almost all of their 2017 gains. The impact of lower steel prices is visible in steel stocks’ 2017 prices.
In this series, we’ll look at recent steel industry developments and the key events and data points that US steel investors should follow. Since steel is a global commodity (MT), US steel prices are affected by global developments. We’ll also look at some of the global events that could interest US steelmakers in October.