Markets Insider
- US Steel spiked Thursday after reports suggested President Donald Trump is ready to impose tariffs on imported steel and aluminum.
- A tweet from Trump Thursday morning appeared to show his support for tariffs.
- The stock then rolled over after CNBC reported that an announcement on Thursday was “unlikely.”
- Shares gained last week after a Bloomberg News report said Trump favored the strongest of three tariff options.
Shares of US Steel surged more than 6% in early trading Thursday after Bloomberg’s Jennifer Jacobs and Joe Deaux reported late Wednesday the president told aides he wants tariffs, or a tax on imports, of 25% for steel and 10% for aluminum.
The stock then pared a chunk of its early gains after a CNBC report said it was “unlikely” there would be an announcement at 11 a.m. ET as previously expected. US Steel is currently up 1.98% at $44.37 a share.
Thursday morning, President Donald Trump appeared to signal he would announce the tariffs he was said to be considering last week.
“Our Steel and Aluminum industries (and many others) have been decimated by decades of unfair trade and bad policy with countries from around the world,” he tweeted. “We must not let our country, companies and workers be taken advantage of any longer. We want free, fair and SMART TRADE!”
The move is designed to spur support and jobs in manufacturing rich states, home to many of the country’s largest metals producers, including US Steel and aluminum giant Alcoa. Kentucky-based Century Aluminum will likely rehire some 350 workers to bring its plant back back to full production capacity from the current two-fifths levels if new tariffs spur demand as promised, CEO Michael Bless told Reuters this month.
But the move could also increase tensions between the US and countries from which it imports steel and aluminum, especially China, whose steel production skyrocketed from just 127.2 million tons in 2000 to 806.7 million in 2016, according to the World Steel Association.
Raising steel tariffs is something “other countries could easily follow,” Nomura analyst Jordan Rochester said in a note to clients in February. It would be an action that no country has crossed since World War II, opening the way to a trade war.”
Shares of US Steel are up 19.42% this year.
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