Cleveland-Cliffs and U.S. Steel Corporation stocks have fallen this week amid the broader market sell-off. The sector barely recovered from the trade war.
U.S. Steel stock (X) has underperformed peers so far in 2019. Notably, it’s the only leading US steel name that’s trading with a YTD (year-to-date) loss.
In this overview article, we’ll see how analysts are rating the leading steel stocks, and we’ll also compare performance from the top five steel companies.
Apart from all of the synergies and strategic rationales, CLF’s current management team, especially Goncalves, might be the X factor for the transaction.
President Trump tweeted that the Section 232 steel and aluminum tariffs would be restored for Brazil and Argentina. Could this Santa Claus rally continue?
Based on yesterday’s closing prices, U.S. Steel Corporation (X), AK Steel (AKS), and Nucor (NUE) were up 20.2%, 14.8%, and 3.8%, respectively, this month.
Cleveland-Cliffs (CLF) and U.S. Steel (X) are in the red this year. As we head into the 2020 election, both companies desperately need another “Trump effect.”
Citi is bearish on iron ore and steel prices, expecting bad news for Cleveland-Cliffs (CLF) and US steel companies. This year, CLF stock is trading almost flat.
AK Steel (AKS) stock was trading deep in the red in after-market trade on Wednesday. Based on the YTD price action, the stock is outperforming its peers.
Moody’s turned bearish on the US steel sector and downgraded the sector’s outlook from stable to negative. However, US steel stocks have been largely stable.
Preliminary data showed that US steel imports fell sharply in August after the spike in July. However, falling imports haven’t restored investor sentiments.
JPMorgan Chase analyst Michael Gambardella downgraded US steel stocks. Gambardella had been bullish on US steel stocks even when Wall Street turned bearish.
This week, three leading US steel companies provided their third-quarter earnings guidances. All these guidances were lower than analysts were expecting.
Last month, Trump claimed that the US steel industry is “thriving.” With US steel companies set to release their guidance, we may see if Trump is right.
US steel stocks are rising today on multiple factors. There’s rising optimism over a US-China trade deal, and Chinese steel exports plummeted in August.
US steel stocks have been strong in September amid the trade war de-escalation. U.S. Steel and AK Steel are up 4.8% and 6.0%, respectively, this month.
For the metals and mining industry, good news has been tough to come by this year. On Tuesday, Moody’s downgraded U.S. Steel’s credit rating by one notch.
According to Buffett, “Americans will be both more prosperous and safer if all nations thrive.” His words might be especially prophetic for US steel companies.
In an interview with Fox, President Donald Trump said that US “steel companies are going through the roof” after Section 232 tariffs that were imposed last year. However, U.S. Steel (X), AK Steel (AKS), Nucor (NUE), and Steel Dynamics (STLD) fell to 52-week lows last month, respectively.
In March 2018, US President Donald Trump tweeted, “Trade wars are good, and easy to win.” The basic premise behind this assumption is the massive trade deficit that the US runs with almost every major trading partner.
It would be fair to say that the Section 232 exemptions were an enabler in Mexico ratifying the USMCA. The Trump administration has also tried to put some safeguards in place so that imports from Canada and Mexico don’t surge after the exemption. While these measures look positive, steel imports from Canada and Mexico could still rise.
In its Section 232 steel probe, the Commerce Department pointed to the high steel import to export ratio. It emphasized the subsidized steel in other countries that makes US steel exports to those countries uncompetitive. Now, while US steel imports have fallen after the Section 232 tariffs, we’ve seen a steeper fall in US steel exports.
When it recommended Section 232 steel tariffs, the Commerce Department highlighted certain issues such as the fact that the US steel industry’s capacity utilization rate was below 80%, which is not sustainable. Now, 15 months into the tariffs, the Commerce Department seems to have achieved its objective, as the US steel industry has operated above the 80% utilization rate almost consistently over the last year.
It’s been more than 15 months since President Trump announced a 25% tariff on US steel imports and a 10% tariff on aluminum imports. The tariffs came into effect towards the end of March 2018 and have been a key bone of contention between the United States and its trading partners.
AK Steel (AKS) has fallen 17.8% in the second quarter and is now flat for the year. U.S. Steel (X) has also pared its 2019 gains and is negative for the year.
US steel and iron ore stocks were in the red today in the early trading hours. As of 10:30 AM ET, U.S. Steel (X), AK Steel (AKS), Nucor (NUE), and Cleveland-Cliffs (CLF) were down 1.6%, 0.43%, 1.1%, and 0.5%, respectively.
US equity markets are deep in the red today, and the S&P 500 (SPY) is down 2.4% as of 12:10 PM ET. The SPDR S&P Metals and Mining ETF (XME) is underperforming the broader markets and has lost 4.4%.
Today, U.S. Steel Corporation (X) announced a $1.2 billion investment toward casting and rolling facilities at Mon Valley Works and cogeneration facilities at its Clairton Works plant.
Investors might recall that a major disaster struck Vale (VALE) on January 25, with a dam rupture at its iron ore mine in the Brazilian state of Minas Gerais (EWZ) killing more than 300 people.
Cleveland-Cliffs’ (CLF) Mining and Pelletizing sales volumes fell in Q1 2019, by 3.8% YoY (year-over-year) to 1.55 million tons, meeting just 7.8% of its expected volume for the full year.
AK Steel (AKS) is expected to release its first-quarter earnings on April 29. Analysts polled by Thomson Reuters expect the company to post revenues of $1.74 billion in the quarter.
AK Steel (AKS) is scheduled to release its first-quarter earnings on April 29 after the markets close. The company is to hold its earnings call on April 30.
