Steel Stocks Whipsawed as Tariffs Are On, Then Off and Then On

(Bloomberg) -- Need an adrenaline rush? You could try riding this new roller coaster in Britain that bursts into flame mid-ride or better yet, just trade the steel and aluminum stocks. The shares of these metals companies have been particularly volatile today, amid market confusion on when or if there will be an announcement on trade imports from President Donald Trump. 

A quick look at United Steel Steel Corp.’s intraday chart reveals the crazy ride steel investors went on today. The morning session saw investors piling into steel and aluminum stocks, sending them higher in pre-market trading. Then came a report from CNBC and confirmation from the White House that there will be no announcement on the import decision, causing the stocks to reach their session lows. Then at mid-afternoon came the announcement from Trump that he plans to slap a 25 percent tariff on steel imports and 10 percent on aluminum, sending the market into a frenzy, launching the stocks to session high and sending the rest of the market plummeting.

Now the market will look for more details on the policy and how the administration is going to implement it. Trump said he will sign the order sometime next week and didn’t address any potential exclusions, either by type or by country. Also worth noting is that Nucor Corp. usually provides first quarter earnings guidance around mid-March (last year it was on March 16), which could act as an additional catalyst for the sector, as it provides a yardstick for other steelmakers.

To contact the reporter on this story: Aoyon Ashraf in Toronto at aashraf7@bloomberg.net.

To contact the editors responsible for this story: Arie Shapira at ashapira3@bloomberg.net, Scott Schnipper

©2018 Bloomberg L.P.