Jefferies is confident on US steel sector
In the aftermath of Donald Trump winning the US presidential election, Jefferies upgraded United States Steel (X) from “hold” to “buy” with a target price of $26. (X)+to+Buy+Following+Trump+Win/12224297.html" target="_blank" rel="noopener noreferrer">Jefferies said, “The US steel industry should stand out as a unique beneficiary of a Trump presidency. Protectionism will significantly rise; the US is already short steel, and falling imports will improve domestic pricing power. In addition, increased infrastructure spend may significantly boost demand for long steel products. Steel price momentum has recently emerged and should extend further into 2017.”
Morgan Stanley upgrades US steel sector
Morgan Stanley analyst Evan Kurtz wrote, “We believe Trump’s plans for infrastructure spending and trade protection, as two of the most digestible of his proposals, could be early in the queue.” Kurtz thus upgraded United States Steel (X) and AK Steel (AKS) from “equal weight” to “overweight.”
Cliffs gets an upgrade
Better fortunes for the US steel sector also bode well for Cliffs Natural Resources (CLF), the only North American pure play iron ore pellet supplier. Kurtz thus upgraded Cliffs from “underweight” to “equal weight” and increased its target price from $3 to $9.