Coal and iron ore producer Cliffs Natural Resources 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 AKS and United States Steel 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 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.
Market News and Data brought to you by Benzinga APIsDisclosure: At the time of this writing, I did not own shares of any companies mentioned in this post.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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