IAMGOLD Corp (IAG), AK Steel Holding Co. (AKS), Chesapeake Energy (CHK), Copano Energy, L.L.C. (CPNO), Hess Corp (HES), ArcelorMittal (MT) and Exxon Mobil (XOM) had ratings on them adjusted by analysts.
Macquarie upgraded AK Steel Holding Co. (AKS) from an Underperform rating to a Neutral rating.
Stifel Nicolaus upgraded Chesapeake Energy (CHK) from a Hold rating to a Buy rating.
Societe Generale upgraded IAMGOLD Corp. (IAG) from a Sell rating to a Hold rating.
RBC Capital downgraded Copano Energy, L.L.C. (CPNO) from an Outperform rating to a Sector Perform rating.
Capital One downgraded Hess Corp. (HES) from an Add rating to a Neutral rating.
HSBC downgraded ArcelorMittal (MT) from a Neutral rating to an Underweight rating.
Macquarie downgraded Exxon Mobil (XOM) from an Outperform rating to a Neutral rating.
Showing posts with label ArcelorMittal. Show all posts
Showing posts with label ArcelorMittal. Show all posts
Wednesday, January 30, 2013
Friday, November 2, 2012
Barrick (ABX) (AAA) (AWC) (OIS) (EPL) (FSLR) (MT) Ratings Changes
Barrick Gold Corp (ABX), ALLANA POTASH CORP (AAA), Alumina Limited (AWC), Oil States International, Inc. (OIS), Energy Partners, Ltd. (EPL), First Solar, Inc. (FSLR) and ArcelorMittal ADR (MT) had ratings on them adjusted by analysts.
Raymond James upgraded ALLANA POTASH CORP (AAA) from a "Market Perform" rating to an "Outperform" rating. They have a price target of $1.25 on the company.
Bank of America (BAC) upgraded Alumina Limited (AWC) from a "Neutral" rating to a "Buy" rating.
Raymond James upgraded Oil States International, Inc. (OIS) from a "Market Perform" rating to an "Outperform" rating. They have a price target of $85.00 on the company.
BMO Capital Markets downgraded Barrick Gold Corp. (ABX) from an "Outperform" rating to a "Market Perform" rating. They have a price target of $46.00 on the company.
Global Hunter Securities downgraded Energy Partners, Ltd. (EPL) from a "Buy" rating to an "Accumulate" rating. They have a price target of $25.00 on the company.
Cantor Fitzgerald downgraded First Solar, Inc. (FSLR) from a "Buy" rating to a "Hold" rating.
Natixis downgraded ArcelorMittal ADR (MT) from a "Buy" rating to a "Neutral" rating.
Friday, October 5, 2012
First Solar (FSLR) (SNP) (BNK) (MT) (PDS) (TE) (AXU) (VNR) Ratings Changes and Initiations
First Solar, Inc. (FSLR), China Petroleum and Chemical (SNP), Bankers Petroleum Ltd. (BNK), ArcelorMittal (MT), Precision Drilling (PDS), TECO Energy, Inc. (TE), Alexco Resource Corp (AXU) and Vanguard Natural Resources (VNR) had ratings adjusted or initiated on them.
Bernstein upgraded China Petroleum and Chemical (SNP) from a "Market Perform" rating to an "Outperform" rating.
Raymond James downgraded Bankers Petroleum Ltd. (BNK) from an "Outperform" rating to a "Market Perform" rating.
Avian Securities downgraded First Solar, Inc. (FSLR) from a "Positive" rating to a "Negative" rating.
Citigroup (C) downgraded ArcelorMittal (MT) from a "Buy" rating to a "Neutral" rating.
Desjardins downgraded Precision Drilling (PDS) from a "Hold" rating.
Zacks downgraded TECO Energy, Inc. (TE) from a "Neutral" rating to an "Underperform" rating. They have a price target of $16.00 on the company.
Stonecap Securities initiated coverage on Alexco Resource Corp (AXU). They placed an "Outperform" rating on the company.
UBS AG initiated coverage on Vanguard Natural Resources (VNR). They placed a "Buy" rating and price target of $33.00 on the company.
Friday, November 5, 2010
ArcelorMittal (NYSE:MT), Carpenter Technology (NYSE:CRS), US Steel (NYSE:X) Soar on Collasping US Dollar, QE2
ArcelorMittal (NYSE:MT), Carpenter Technology (NYSE:CRS), US Steel (NYSE:X) all moved up with the broader commodity sector Thursday, as the announcement that the Federal Reserve was going to inflate again via its quantitative easing strategy pushed up the price of commodities in anticipation of the inevitable inflation to come.
Commodity prices rising included oil prices, gold, silver and aluminum. Gold prices reached record levels again, straining toward the $1,400 an ounce level. Silver broke the $26 level, and seems poised to continue moving up.
The steel industry could go through a period of uncertainty as currencies respond to the fall in value of the U.S. dollar, which will affect margins because of the fluctuations and the battle by some against the Chinese renminbi, which they'll have to attempt to protect themselves against.
ArcelorMittal closed at $47.33 Thursday, rising $1.66, or 3.63 percent. Carpenter Technology surged to close at $35.51, gaining $0.96, or 2.78 percent. US Steel was up to $47.33 at the end of the trading session, gaining $1.66, or 3.63 percent.
Commodity prices rising included oil prices, gold, silver and aluminum. Gold prices reached record levels again, straining toward the $1,400 an ounce level. Silver broke the $26 level, and seems poised to continue moving up.
The steel industry could go through a period of uncertainty as currencies respond to the fall in value of the U.S. dollar, which will affect margins because of the fluctuations and the battle by some against the Chinese renminbi, which they'll have to attempt to protect themselves against.
ArcelorMittal closed at $47.33 Thursday, rising $1.66, or 3.63 percent. Carpenter Technology surged to close at $35.51, gaining $0.96, or 2.78 percent. US Steel was up to $47.33 at the end of the trading session, gaining $1.66, or 3.63 percent.
Friday, October 29, 2010
Citigroup (NYSE:C) Sees Cliffs' (NYSE:CLF) ArcelorMittal (NYSE:MT) Negotiations as No Risk to Earnings
Citigroup Inc. (NYSE:C) commented on Cliffs Natural Resources Inc.'s (NYSE:CLF) earnings today, targeting specifically the ongoing negotiations with ArcelorMittal (NYSE:MT).
Citigroup's Brian Yu wrote in a note that Citi sees negotiations between the companies "as a timing issue rather than an earnings risk."
Cliffs significantly missed on their third quarter operating earnings per share, which came in at $2.08, far below the $2.70 Citigroup was looking for. Earnings in general were reported at $2.18 a share.
Cliffs was trading at $64.24, up $0.87, or 1.37 percent as of 1:00 PM EDT.
Citigroup's Brian Yu wrote in a note that Citi sees negotiations between the companies "as a timing issue rather than an earnings risk."
Cliffs significantly missed on their third quarter operating earnings per share, which came in at $2.08, far below the $2.70 Citigroup was looking for. Earnings in general were reported at $2.18 a share.
Cliffs was trading at $64.24, up $0.87, or 1.37 percent as of 1:00 PM EDT.
Wednesday, October 27, 2010
US Steel (NYSE:X), AK Steel (NYSE:AKS), ArcelorMittal (NYSE: MT) Post Disappointing Earnings
The steel industry remains under tremendous pressure, as US Steel (NYSE:X), AK Steel (NYSE:AKS), ArcelorMittal (NYSE: MT) all reported poor results for their most recent quarter, with US Steel and AK Steel both posting losses.
Weak economies around the world are the major contributors to the terrible performance of the steel industry, as even countries with growth prospects like China are cutting back in areas to protect their economies from further erosion, especially the construction sector in China.
The consequence of China cutting back on domestic steel consumption is companies there will attempt to make up for it by exporting steel to other nations, which will continue to put downward pressure on prices, margins and earnings.
Every important metric for the industry is under pressure, as demand has fallen, sales dropped and costs risen. Many steel companies don't see this changing anytime soon.
As the global economy goes so will go the steel industry, and that doesn't bode well in an economic climate of caution and little or no growth.
US Steel lost $0.35 a share on revenue of $4.50 billion. Last year in the same quarter US Steel lost $0.17 a share. They haven't been profitable since the latter part of 2008.
ArcelorMittal's earnings dropped by 21 percent in the second quarter, but were still able to increase profits by 48 percent over the same time last year. Most of that is attributed to China demand for steel falling.
AK Steel also posted a loss for the quarter, losing $59.2 million, based mostly on the increase in iron ore prices.
Weak economies around the world are the major contributors to the terrible performance of the steel industry, as even countries with growth prospects like China are cutting back in areas to protect their economies from further erosion, especially the construction sector in China.
The consequence of China cutting back on domestic steel consumption is companies there will attempt to make up for it by exporting steel to other nations, which will continue to put downward pressure on prices, margins and earnings.
Every important metric for the industry is under pressure, as demand has fallen, sales dropped and costs risen. Many steel companies don't see this changing anytime soon.
As the global economy goes so will go the steel industry, and that doesn't bode well in an economic climate of caution and little or no growth.
US Steel lost $0.35 a share on revenue of $4.50 billion. Last year in the same quarter US Steel lost $0.17 a share. They haven't been profitable since the latter part of 2008.
ArcelorMittal's earnings dropped by 21 percent in the second quarter, but were still able to increase profits by 48 percent over the same time last year. Most of that is attributed to China demand for steel falling.
AK Steel also posted a loss for the quarter, losing $59.2 million, based mostly on the increase in iron ore prices.
Wednesday, October 13, 2010
BHP (NYSE:BHP), Rio Tinto (NYSE:RTP) Meeting with EU Regulators
The fate of the proposed iron ore joint venture between BHP (NYSE:BHP) and Rio Tinto (NYSE:RTP) will be pushed along by the meeting the companies will have with EU antitrust regulators.
After the meeting, which will be near the end of October, the European Commission will make a decision on whether to allow the $116 billion venture to proceed.
What will be determined is if it is anti-competitive or not.
Both companies will keep their marketing operations separate, which they say should help with competitive concerns.
While a number of other countries are also reviewing the deal, Europe is considered the toughest regulatory environment, and the deal would probably go through if it passes there.
Opposing the deal are the European steelmakers' lobbying group Eurofer, which includes steel producing giants like Germany's ThyssenKrupp (OTC:TYEKF) and ArcelorMittal (NYSE:MT).
After the meeting, which will be near the end of October, the European Commission will make a decision on whether to allow the $116 billion venture to proceed.
What will be determined is if it is anti-competitive or not.
Both companies will keep their marketing operations separate, which they say should help with competitive concerns.
While a number of other countries are also reviewing the deal, Europe is considered the toughest regulatory environment, and the deal would probably go through if it passes there.
Opposing the deal are the European steelmakers' lobbying group Eurofer, which includes steel producing giants like Germany's ThyssenKrupp (OTC:TYEKF) and ArcelorMittal (NYSE:MT).
Wednesday, October 6, 2010
Arcelor Mittal (NYSE:MT) and Peabody (NYSE:BTU) Downgraded by Deutsche Bank (NYSE:DB)
Deutsche Bank (NYSE:DB) downgraded Arcelor Mittal (NYSE:MT) and Peabody Energy Corp. (NYSE:BTU), taking them both down from "Buy" to "Hold."
Deutsche said, "Since our last quarterly updates, the coal/steel sectors have outperformed the market. The performance can be attributed to improved economic sentiment (China, US), commodity price performance, USD weakness, etc. As a result, risk-reward is largely balanced. Also, through this report we trim estimates (from slightly to significantly), and with share prices now nearing some of our PTs, we have trimmed some ratings."
Although economic sentiment isn't convincing, commodity prices and the weakness of the U.S. dollar will continue to be a major factor in the performance of companies producing raw materials, and that could be a strong impetus for companies like Arcelor Mittal and Peabody Energy.
The market agreed Tuesday, as it shrugged off the downgrades and pushed the price of shares in both companies up strongly.
Arcelor Mittal closed at $33.24, gaining $1.12, or 3.49 percent, while Peabody Energy ended the session at $50.46, increasing by $1.01, or 2.04 percent.
Deutsche said, "Since our last quarterly updates, the coal/steel sectors have outperformed the market. The performance can be attributed to improved economic sentiment (China, US), commodity price performance, USD weakness, etc. As a result, risk-reward is largely balanced. Also, through this report we trim estimates (from slightly to significantly), and with share prices now nearing some of our PTs, we have trimmed some ratings."
Although economic sentiment isn't convincing, commodity prices and the weakness of the U.S. dollar will continue to be a major factor in the performance of companies producing raw materials, and that could be a strong impetus for companies like Arcelor Mittal and Peabody Energy.
The market agreed Tuesday, as it shrugged off the downgrades and pushed the price of shares in both companies up strongly.
Arcelor Mittal closed at $33.24, gaining $1.12, or 3.49 percent, while Peabody Energy ended the session at $50.46, increasing by $1.01, or 2.04 percent.
Wednesday, September 22, 2010
US Steel (NYSE:X), Steel Dynamics (Nasdaq:STLD, Nucor (NYSE:NUE) Downgraded by Longbow
The steel industry continues to be out of favor, and Longbow Research reflectd that with their downgrades of U.S. Steel (NYSE:X), Steel Dynamics (Nasdaq:STLD and Nucor (NYSE:NUE), although MF Global (NYSE:MF) did upgrade Arcelor Mittal (MT) from "Neutral" to "Buy" in the sector.
US Steel was downgraded from "Buy" to "Neutral," with a price target of $60 kept in place; Steel Dynamics was downgraded from "Buy" to "Neutral," with Longbow keeping a price target of $20 on the company; Nucor was dropped from "Neutral" to "Sell."
Steel prices are expected to remain under pressure for some time, and competition in certain segments like flat roll mill will continue to challenge a number of the steel producers.
Goldman Sachs (NYSE:GS) also downgraded several steel producers recently, including U.S. Steel and Nucor.
US Steel was downgraded from "Buy" to "Neutral," with a price target of $60 kept in place; Steel Dynamics was downgraded from "Buy" to "Neutral," with Longbow keeping a price target of $20 on the company; Nucor was dropped from "Neutral" to "Sell."
Steel prices are expected to remain under pressure for some time, and competition in certain segments like flat roll mill will continue to challenge a number of the steel producers.
Goldman Sachs (NYSE:GS) also downgraded several steel producers recently, including U.S. Steel and Nucor.
Thursday, September 9, 2010
BHP (NYSE:BHP), ArcelorMittal (NYSE:MT) Drop Iron Ore Discussions
BHP Billiton (NYSE:BHP) has seemingly been everywhere in attempts to make deals lately, but the one they were attempting with ArcelorMittal (NYSE:MT) hasn't worked out, as they announced they've stopped the negotiations related to the iron ore assets in Guinea and Liberia.
The talks over over attempting to merge the separate assets both companies hold in the two countries into one joint venture.
According to their joint statement, they weren't able to reach a commercial agreement, so abandoned the negotiations.
Both companies will continue on in their with their own interests in the region.
BHP is still battling to acquire fertilizer giant Potash Corp. (NYSE:POT), waiting to see if there is a competitive bid waiting on the horizon for them.
The talks over over attempting to merge the separate assets both companies hold in the two countries into one joint venture.
According to their joint statement, they weren't able to reach a commercial agreement, so abandoned the negotiations.
Both companies will continue on in their with their own interests in the region.
BHP is still battling to acquire fertilizer giant Potash Corp. (NYSE:POT), waiting to see if there is a competitive bid waiting on the horizon for them.
Wednesday, September 8, 2010
Bank of America (NYSE:BAC) Recommends US Steel (NYSE:X)
The steel industry has been on a tear the last couple of days as a series of announcements has created a short-term boost to the industry, with US Steel (NYSE:X) seeming to be one of the favorites in the sector, as Bank of America (NYSE:BAC) recommended investors to buy shares in the steelmaker.
One other temporary factor which has yet to be confirmed in any way, was the rumors US Steel is a candidate for acquisition. No information was offered as to who had an interest when the rumors were circulating.
A couple other factors were ArcelorMittal's (NYSE:MT) announcement they're raising prices, China's growth rate, possible infrastructure projects domestically, and in China's rural areas as well.
The China growth aspect came from PMI numbers suggesting they're growing fast than thought in the recent past.
In the short term China has also decided to shutter its steel plants for two weeks to shrink its steel supply.
Pricing power over the next couple of months is expected to increase, making it a good play in the eyes of Bank of America.
One other temporary factor which has yet to be confirmed in any way, was the rumors US Steel is a candidate for acquisition. No information was offered as to who had an interest when the rumors were circulating.
A couple other factors were ArcelorMittal's (NYSE:MT) announcement they're raising prices, China's growth rate, possible infrastructure projects domestically, and in China's rural areas as well.
The China growth aspect came from PMI numbers suggesting they're growing fast than thought in the recent past.
In the short term China has also decided to shutter its steel plants for two weeks to shrink its steel supply.
Pricing power over the next couple of months is expected to increase, making it a good play in the eyes of Bank of America.
US Steel (NYSE:X), AK Steel, (NYSE:AKS), Cliffs (NYSE:CLF) Nucor (NYSE:NUE) Rise on Pricing, Infrastructure
US Steel (NYSE:X), AK Steel Holding Corporation (NYSE:AKS), Cliffs Natural Resources Inc (NYSE:CLF) and Nucor (NYSE:NUE) are all up today on news from Arcelor Mittal (NYSE:MT) they're going to raise prices, and the possibility of getting more business from an infrastructure initiative from the White House.
Another factor was the announced shuttering of steel plants in China for a couple of weeks in order to deal with the glut of steel in the market at this time. That could give more pricing power to the steel companies.
Finally, the PMI report from China showed they were growing at a better rate than thought, and that suggests better commodity demand, including steel.
China has hinted of moving their infrastructure projects to rural areas instead of urban areas, as the property markets in urban areas are in danger of a bubble.
The one element that has proven legs in all of this is pricing power, which most steel companies will probably engage in in response to Arcelor Mittal. The rest is highly speculative and unproven, although a possibility.
Another factor was the announced shuttering of steel plants in China for a couple of weeks in order to deal with the glut of steel in the market at this time. That could give more pricing power to the steel companies.
Finally, the PMI report from China showed they were growing at a better rate than thought, and that suggests better commodity demand, including steel.
China has hinted of moving their infrastructure projects to rural areas instead of urban areas, as the property markets in urban areas are in danger of a bubble.
The one element that has proven legs in all of this is pricing power, which most steel companies will probably engage in in response to Arcelor Mittal. The rest is highly speculative and unproven, although a possibility.
Thursday, September 2, 2010
Cliffs (NYSE:CLF) Hires Former Alcoa (NYSE:AA), ArcelorMittal (NYSE:MT), Exec
Cliffs Natural Resources Inc. (NYSE:CLF) announced they've hired James R. Michaud, who formerly worked at ArcelorMittal (NYSE:MT) and Alcoa Inc (NYSE:AA).
Michaud will step into the position of Vice President, Human Resources, at Cliffs.
At ArcelorMittal, Michaud was vice president human resources/labor relations - Americas, while at Alcoa he served in a variety of executive human resources and labor relations positions.
Michaud will start at Cliffs on September 7, 2010, reporting to executive vice president-finance and administration and chief financial officer, Laurie Brlas.
For the last year and a half, Michaud had worked as a partner at Laurus Strategies.
Michaud will step into the position of Vice President, Human Resources, at Cliffs.
At ArcelorMittal, Michaud was vice president human resources/labor relations - Americas, while at Alcoa he served in a variety of executive human resources and labor relations positions.
Michaud will start at Cliffs on September 7, 2010, reporting to executive vice president-finance and administration and chief financial officer, Laurie Brlas.
For the last year and a half, Michaud had worked as a partner at Laurus Strategies.
Wednesday, July 28, 2010
ArcelorMittal (NYSE:MT) Misses Revenue, Lowers Guidance
Strong revenue wasn't enough for ArcelorMittal (NYSE:MT) to impress investors and traders, as they were able to generate $21.65 billion in revenue for the second quarter, a 43 percent gain, also beating analysts' estimates by close to $2 billion. They are getting punished though for missing on revenue, even though earnings outperformed.
Earnings per share were $1.13, on $1.7 billion in net profits, 43 cents above estimates.
Guidance was the most concerning for shareholders, as the third quarter looks weak for earnings, based largely on a slowing Chinese economy.
Chief Executive Officer Lakshmi Mittal said in this in a statement, “Although the third quarter will be impacted by a combination of seasonal factors and the effects of the economic slowdown in China, underlying demand continues to show improvement. The challenge for the second half of the year will be to pass on the full extent of cost increases to our customers.”
Mittal added that profits could plunge by up to 30 percent in the third quarter from this quarter.
Other factors include the rising costs of iron ore at the same time demand is slowing. That should eventually push down iron ore prices, but that hasn't caught up with lower demand yet.
Earnings per share were $1.13, on $1.7 billion in net profits, 43 cents above estimates.
Guidance was the most concerning for shareholders, as the third quarter looks weak for earnings, based largely on a slowing Chinese economy.
Chief Executive Officer Lakshmi Mittal said in this in a statement, “Although the third quarter will be impacted by a combination of seasonal factors and the effects of the economic slowdown in China, underlying demand continues to show improvement. The challenge for the second half of the year will be to pass on the full extent of cost increases to our customers.”
Mittal added that profits could plunge by up to 30 percent in the third quarter from this quarter.
Other factors include the rising costs of iron ore at the same time demand is slowing. That should eventually push down iron ore prices, but that hasn't caught up with lower demand yet.
Tuesday, June 15, 2010
US Steel (NYSE:X), Arcelor Mittal (NYSE:MT), Nucor (NYSE:NUE) Coming Under Pressure?
The announcement by Nucor (NYSE:NUE) today that was lowering its earnings guidance today didn't seem to have much impact on the steel industry, as companies like US Steel (NYSE:X), Arcelor Mittal (NYSE:MT) and Nucor (NYSE:NUE) were all up on the day.
But news that steel production is outpacing demand over the last month or so has put downward pressure on margins, and ultimately profits.
Nucor in particular said their decrease in demand came from residential and non-residential segments, driving down the earnings the company had originally projected.
Other countries like India has stated similar things in that the supply is higher than demand now, and their steel companies have had to sell at lower prices to move product.
This could put pressure on others like Arcelor Mittal and US Steel, along with most steel companies until the situation is mitigated.
Specialty steelmakers could do better depending on what their products are.
But news that steel production is outpacing demand over the last month or so has put downward pressure on margins, and ultimately profits.
Nucor in particular said their decrease in demand came from residential and non-residential segments, driving down the earnings the company had originally projected.
Other countries like India has stated similar things in that the supply is higher than demand now, and their steel companies have had to sell at lower prices to move product.
This could put pressure on others like Arcelor Mittal and US Steel, along with most steel companies until the situation is mitigated.
Specialty steelmakers could do better depending on what their products are.
Thursday, June 10, 2010
ArcelorMittal (NYSE:MT) Starts Up West African Iron Ore Mines Again
After closing down operations at two iron ore projects in West Africa, ArcelorMittal (NYSE:MT) has now restarted them again.
Located at Faleme in Senegal and Mount Nimba in Liberia, the two iron ore mines had operations suspended in 2009 in response to iron ore prices falling in response to decreasing demand.
Production for the Mount Nimbi project in Liberia is scheduled to resume sometime in the middle of 2011. No specifics on reopening Faleme were given by the company, although original estimates were to have it producing by 2011.
After delaying the projects in 2009, the company is cautiously moving forward in what appears to be a mild rebound in demand, although recent events in Europe with their sovereign debt crisis and slowdown in China, along with the U.S. economy going nowhere, has generated concerns in all companies supplying raw materials as whether or not demand in the near- and mid-term is going to grow.
Located at Faleme in Senegal and Mount Nimba in Liberia, the two iron ore mines had operations suspended in 2009 in response to iron ore prices falling in response to decreasing demand.
Production for the Mount Nimbi project in Liberia is scheduled to resume sometime in the middle of 2011. No specifics on reopening Faleme were given by the company, although original estimates were to have it producing by 2011.
After delaying the projects in 2009, the company is cautiously moving forward in what appears to be a mild rebound in demand, although recent events in Europe with their sovereign debt crisis and slowdown in China, along with the U.S. economy going nowhere, has generated concerns in all companies supplying raw materials as whether or not demand in the near- and mid-term is going to grow.
Saturday, June 5, 2010
US Steel (NYSE:X), AK Steel (NYSE:AKS), Nucor (NYSE:NUE), Arcelor Mittal (NYSE:MT) Crushed Last Week
Steel stocks took a beating all week, as US Steel (NYSE:X), AK Steel (NYSE:AKS), Nucor (NYSE:NUE) and Arcelor Mittal (NYSE:MT) stock charts all looked like you were going down a mountain. One exception was Gerdau S.A. (NYSE:GGB), which while losing share price during the week, wasn't as pronounced as the others.
All of this is based on the economic sovereign debt crisis in Europe, as well as the belt tightening of China, which will result in lowered demand for steel, and is also lowering the price of iron ore.
US Steel is particularly exposed to Europe, which could cause them problems in the long run, as that's a challenge that isn't going to go away any time soon.
US Steel finished the week at $41.99, down Friday by $3.29, or 7.27 percent.
The week for AK Steel ended at $13.34 a share, down on Friday by $1.14, or 7.87 percent.
Nucor ended the last five trading days at $40.93, dropping on Friday by $1.61, or 3.78 percent.
For Arcelor Mittal, they came in at $27.50 for the end of the week, plunging on Friday by $1.63, or 5.60 percent.
Gerdau S.A. finished the trading week at $13.01, down $0.64 on the day, or 4.69 percent.
With this precipitous weekly drop in steel stocks, there is sure to be a rebound based on that and nothing else, the reason why some say they like the stocks now.
That's primarily based on current valuations and not related to fundamentals and the macro-economic realities they're facing.
Long-term the steel industry and companies heavily exposed to it should struggle, especially those with heavy exposure to Europe, which is guaranteed to be a slow economy for some time to come, if not poised to go back into a recession, if they're not already there.
China's different only in the clarity isn't there yet as to how the austerity measures they're taking will impact the steel and other industries.
While China will no doubt continue to grow, it won't be at the 12 percent or higher rates it has been in the recent past. More than likely it'll start to come down to a more reasonable 7 to 8 percent rate in the near term.
With the U.S. economy about level at this time, and the combination of Europe and China, it'll have a dramatic impact on the commodity sector in general, and steel industry specifically.
All of this is based on the economic sovereign debt crisis in Europe, as well as the belt tightening of China, which will result in lowered demand for steel, and is also lowering the price of iron ore.
US Steel is particularly exposed to Europe, which could cause them problems in the long run, as that's a challenge that isn't going to go away any time soon.
US Steel finished the week at $41.99, down Friday by $3.29, or 7.27 percent.
The week for AK Steel ended at $13.34 a share, down on Friday by $1.14, or 7.87 percent.
Nucor ended the last five trading days at $40.93, dropping on Friday by $1.61, or 3.78 percent.
For Arcelor Mittal, they came in at $27.50 for the end of the week, plunging on Friday by $1.63, or 5.60 percent.
Gerdau S.A. finished the trading week at $13.01, down $0.64 on the day, or 4.69 percent.
With this precipitous weekly drop in steel stocks, there is sure to be a rebound based on that and nothing else, the reason why some say they like the stocks now.
That's primarily based on current valuations and not related to fundamentals and the macro-economic realities they're facing.
Long-term the steel industry and companies heavily exposed to it should struggle, especially those with heavy exposure to Europe, which is guaranteed to be a slow economy for some time to come, if not poised to go back into a recession, if they're not already there.
China's different only in the clarity isn't there yet as to how the austerity measures they're taking will impact the steel and other industries.
While China will no doubt continue to grow, it won't be at the 12 percent or higher rates it has been in the recent past. More than likely it'll start to come down to a more reasonable 7 to 8 percent rate in the near term.
With the U.S. economy about level at this time, and the combination of Europe and China, it'll have a dramatic impact on the commodity sector in general, and steel industry specifically.
Thursday, May 27, 2010
Goldman Sachs (NYSE:GS) Adds Arcelor Mittal (NYSE:MT) to Conviction Buy List
Arcelor Mittal (NYSE:MT) was added to the European Conviction Buy List by Goldman Sachs (NYSE:GS), with Goldman saying the ongoing fears related to the sovereign debt crisis in Europe is the major cause of their recent decline.
The shares of Arcelor are down over 28 percent in the last 30 days, against the 12 percent drop in FTSE World Europe.
In the mid-term, Goldman sees Arcelor's fundamentals as remaining strong, and they're in good position to experience future growth "across a wide geographic footprint."
The price target is EUR 48, which is over double the EUR 23.15 it closed at on Wednesday.
The shares of Arcelor are down over 28 percent in the last 30 days, against the 12 percent drop in FTSE World Europe.
In the mid-term, Goldman sees Arcelor's fundamentals as remaining strong, and they're in good position to experience future growth "across a wide geographic footprint."
The price target is EUR 48, which is over double the EUR 23.15 it closed at on Wednesday.
Tuesday, May 25, 2010
U.S. Steel (NYSE:X), ArcelorMittal (NYSE:MT) Up on Positive Sentiment
Even though most analysts agree the metals industry is struggling, what has changed some of their minds is the degree to which that struggle is going to go, and with that in mind, there were some positive moves in the market today with metals, and steel companies like U.S. Steel (NYSE:X) and ArcelorMittal (NYSE:MT), among others.
Few believe there is going to be a huge change in demand any time soon, but the macro-economic conditions have changed in light of the inflation challenges in China and the European sovereign debt crisis, which has generated questions on the demand side of the equation, which not too long ago was considered easy to estimate on the upside.
That has all changed now, and the uncertainties are continuing to weigh on the market and general, and steel producers and metal providers specifically.
On one side you had the surging price of iron ore which was sure to hit the steel industry hard, but with the slowing demand in China, even that has changed quickly, with iron ore prices dropping about 20 percent since then.
Now the iron ore companies are growing concerned with the drop in prices, while the steel industry is breathing a sigh of relief, which has led to some of the more positive outlooks today, from the point of view of it not going to be as hard on the steel industry as thought just a little while ago.
Consequently, analysts think while a correction was justified, it degree of the correction wasn't, and since the market conditions have changed drastically, they've given a more positive view of the steel and metals industry, although still holding price targets down, as iron ore prices are still up high, and demand for other metals don't have many trends to follow and make decisions on, as the market has been volatile and hard to read for now.
Few believe there is going to be a huge change in demand any time soon, but the macro-economic conditions have changed in light of the inflation challenges in China and the European sovereign debt crisis, which has generated questions on the demand side of the equation, which not too long ago was considered easy to estimate on the upside.
That has all changed now, and the uncertainties are continuing to weigh on the market and general, and steel producers and metal providers specifically.
On one side you had the surging price of iron ore which was sure to hit the steel industry hard, but with the slowing demand in China, even that has changed quickly, with iron ore prices dropping about 20 percent since then.
Now the iron ore companies are growing concerned with the drop in prices, while the steel industry is breathing a sigh of relief, which has led to some of the more positive outlooks today, from the point of view of it not going to be as hard on the steel industry as thought just a little while ago.
Consequently, analysts think while a correction was justified, it degree of the correction wasn't, and since the market conditions have changed drastically, they've given a more positive view of the steel and metals industry, although still holding price targets down, as iron ore prices are still up high, and demand for other metals don't have many trends to follow and make decisions on, as the market has been volatile and hard to read for now.
Saturday, May 22, 2010
Arcelor Mittal (NYSE:MT) India Joint Venture Talks
Arcelor Mittal (NYSE:MT) is reportedly in talks with the state-run Steel Authority of India and Tata Steel to enter into a joint venture.
The Steel Authority of India is also in negotiations with Posco, the largest steel producer in Korea concerning a joint venture as well.
Much of this is probably coming from the high demand for steel, which while slowing some in China, is still poised for significant demand for the year, and into the distant future.
China has a strong and growing steel industry, and this would help India compete better if they could land some joint ventures from strong foreign companies like Arcelor Mittal or Posco.
The Steel Authority of India is also in negotiations with Posco, the largest steel producer in Korea concerning a joint venture as well.
Much of this is probably coming from the high demand for steel, which while slowing some in China, is still poised for significant demand for the year, and into the distant future.
China has a strong and growing steel industry, and this would help India compete better if they could land some joint ventures from strong foreign companies like Arcelor Mittal or Posco.
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