Cliffs Natural Resources Falls Along with AK Steel, US Steel
Coal and iron ore producer Cliffs Natural Resources (NYSE: CLF) traded more than 2% lower today.
One equity research analyst told Benzinga that this could be in relation to significant drops in stock prices of steel companies AK Steel (NYSE: AKS) and United States Steel (NYSE: X). Issues with steel producers could hurt demand for iron ore, a key steel input. As of Cliffs' last quarterly earnings release, approximately 81% of product revenues came from iron ore.
AK Steel may be falling as a result of a downgrade to Sell by Goldman Sachs (NYSE: GS) yesterday, June 10. In a June 10 note, Goldman cited falling scrap metal prices as a factor that will hurt steel producers. Cheaper scrap metal can be a substitute for newly produced metal. Goldman already gives United States Steel a Sell rating.
Disclosure: At the time of this writing, I did not own shares of any companies mentioned in this post.
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