Market Overview

Section 232 Public Hearing Wednesday Is 'Unlikely To Affect Steel Equities'

Section 232 Public Hearing Wednesday Is 'Unlikely To Affect Steel Equities'

The Department of Commerce (DOC) is set to hold the Section 232 Hearing at 10 a.m. ET.

The meeting, which was extended due to "unexpectedly high demand” from individuals wishing to speak, is unlikely to affect steel equities according to Alexander Hacking, an equities research analyst at Citi. However, it's interesting to note steel stocks did outperform on Tuesday and in Wednesday’s pre-market session.

  • United States Steel Corporation (NYSE: X) is up 2.06 percent in the pre-market.
  • AK Steel Holding Corporation (NYSE: AKS) up 1.15 percent in the pre-market.
  • Nucor Corporation (NYSE: NUE) up 1.21 percent in the pre-market.
  • Steel Dynamics, Inc. (NYSE: STLD) up 1.33 percent in the pre-market.

Hacking expects the meeting to provide individuals a chance to offer their arguments and commentary on the impact steel imports has on U.S. national security. It also provides the DOC a chance see the amount of pushback from steel consumers. He expects there will be some sort of action announced by Secretary of Commerce Wilbur Ross.

However, it's difficult to determine what impact this will have on steel equities, Hacking said. Steel equities have lost value since President Donald Trump’s win in November, but this meeting potentially could provide them with an upside.

Thomas Gibson, president of the American Iron and Steel Institute, told the NASDAQ, "The probe could result in broader protections that solve a "whack-a-mole" problem of shutting out unfairly traded imports from China or India only to see shipments increase from elsewhere or transshipped through third countries.”

The hearing will be live-streamed starting at 10 a.m., according to the DOC website.

Latest Ratings for X

Jan 2020ReinstatesSell
Dec 2019Initiates Coverage OnBuy
Nov 2019MaintainsSell

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