Thursday, April 21, 2011

Synalloy (SYNL) (AKS) (CMC) (IIIN) Get Boost from Steel 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 prices of AK Steel Holding Corporation (NYSE:AKS), Commercial Metals Company (NYSE:CMC), Synalloy Corp. (Nasdaq:SYNL) and Insteel Industries Inc. (Nasdaq:IIIN) 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.

Insteel Industries Inc. closed Wednesday at $13.30, gaining $0.07, or 0.53 percent. Synalloy Corp. ended the day at $14.05, up $0.39, or 2.86 percent. Commercial Metals Company closed at $16.43, jumping $0.27, or 1.67 percent. AK Steel Holding Corporation closed the session at $16.18, rising $0.10, or 0.62 percent.

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