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Steel Stocks Set to Breakout

by | Jul 27, 2021 | #cyclical, #ibdpartner, #stock, #watchlist | 0 comments

Steel-Stocks-Industrials

With the recovery taking shape, steel prices are soaring. Rising stock prices in the group has many steel stocks breaking downtrends. Demand is picking up as the economy improves. S&P Global Steel data shows that steel prices have increased nearly 60% in the first two quarters of 2021.

 

Steel Stocks – SLX

The World Steel Association is forecasting a 5.8% increase in steel demandfor 2021, as global economies recover from the pandemic. President Biden’s infrastructure and jobs plan is proposed to earmark approximately $115 billion for infrastructure projects (road repairs and bridges). An additional $85 billion is allocated to modernize transit systems. – Yahoo

The Vaneck (SLX) Steel ETF is showing a break of trend. We will watch for follow through in the individual steel stocks as well.

SLX-Steel-Stock-ETF-Daily-Chart

Cleveland-Cliffs – CLF

Cleveland-Cliffs, featured in today’s IBD 50 Stocks To Watch, is getting close to a breakout amid high steel prices and heavy demand for materials. – Investors Business Daily

Cleveland-Cliffs (CLF) is the largest flat-rolled steel producer in North America, after acquiring ArcelorMittal USA and AK Steel last year. That helped it transform from an iron ore miner.

CLF-stock-chart

Steel stocks should benefit from this infrastructure spending, so we are watching for evidence of buying activity over the coming weeks in stocks like Brazil based Vale S.A. (VALE), and German steel producer ArcelorMittal (MT). 

Nucor Corporation – NUE

Charlotte, NC based Nucor Corporation (NUE) is a favorite, while Pittsburgh PA based US Steel Corporation (NYSE: X) reports earnings on Thursday after the bell. 

NUE-Nucor-Daily-Chart

Additional stocks we are trading and watching; Fort Wayne IN based Steel Dynamics, Inc. (STLD) and Cleveland IN based Cleveland-Cliffs (CLF).

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Happy Trading,

Vinny

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The Closing Print live trading and financial blog during market hours.

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