U.S. Steel Sector Rises as Tariffs Take Effect
U.S. stocks in the industrial products and basic materials sectors surged today, overshadowing international markets. This increase follows President Trump’s announcement of a 25% tariff on imported steel and aluminum, potentially raising commodity prices.
American manufacturers are likely to see higher demand for domestic metals, as the tariffs make foreign options more expensive.
Nucor: Leading the Way
Nucor NUE stands out as the largest steel producer in the United States. Often a favorite on Wall Street, Nucor’s broad production abilities have attracted interest from hedge funds and institutional investors. Despite a projected 11% dip in annual earnings this year, forecasts predict a substantial recovery, with earnings expected to jump 42% to $11.18 per share by fiscal 2026.
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U.S. Steel Developments
In his recent address, President Trump declared that Japanese company Nippon Steel will not be allowed to acquire U.S. Steel X, but they can invest in it. Trump emphasized his commitment to safeguarding the U.S. steel industry while asserting that U.S. Steel stands to gain from the newly imposed tariffs as the nation’s second-largest steel producer.
Cleveland-Cliffs: Potential for Growth
Cleveland-Cliffs CLF, the largest iron ore producer in North America, has tried to acquire U.S. Steel and proposed a partnership with Nucor. Although their offers were seen as inadequate and were rejected, a favorable market could enhance Cleveland-Cliffs’ capacity for expanding steel production.
Alcoa: On the Upswing
The rise in aluminum prices has significantly improved Alcoa’s AA operational efficiency. Analysts have noted a positive trend in earnings estimates for Alcoa’s fiscal year 2025, mirroring the stock’s 30% increase in value over the past year.
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Stocks to Keep an Eye On
Two additional stocks to monitor include Steel Dynamics STLD and Kaiser Aluminum KALU. Steel Dynamics is a leading steel producer and metal recycler in the U.S., while Kaiser Aluminum specializes in semi-fabricated specialty aluminum for various industrial sectors including aerospace and automotive.
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Alcoa (AA): Free Stock Analysis Report
United States Steel Corporation (X): Free Stock Analysis Report
Nucor Corporation (NUE): Free Stock Analysis Report
Cleveland-Cliffs Inc. (CLF): Free Stock Analysis Report
Steel Dynamics, Inc. (STLD): Free Stock Analysis Report
Kaiser Aluminum Corporation (KALU): Free Stock Analysis Report
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The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.
