Thursday, April 21, 2011

Steel Companies POSCO (PKX) (MT) (CRS) (SCHN) Get Boost from Consumption Report, (STLD)

Investors have suddenly become steel industry and company believers after the performance of Steel Dynamics, Inc. (Nasdaq:STLD) and the release of estimates for glow steel production by the World Steel Association, which pushed up the share price of ArcelorMittal (NYSE:MT), Carpenter Technology (NYSE:CRS), Schnitzer Steel Industries (NASDAQ:SCHN) and POSCO (NYSE:PKX) Wednesday.

Steel Dynamics gave as its reason for the optimism as growing backlogs in the company’s structural and rail division, but quietly added some of that could have been weather-related.

Also the projected global steel consumption growth of 5.9 percent didn't included the potential devastating effect the slowdown in Japan will have, as it's the largest consumer of steel in the world. Without that, the numbers are pretty meaningless. And it will take time, as with everything related to Japan at this time, before we know the full impact on steel and other sectors.

POSCO closed Wednesday at $113.23, gaining $2.73, or 2.47 percent. Schnitzer Steel Industries ended the day at $60.55, up $0.94, or 1.58 percent. Carpenter Technology closed at $44.05, jumping $0.85, or 1.97 percent. ArcelorMittal closed the session at $36.11, rising $1.15, or 3.29 percent.

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