Steel stocks surge after Trump doubles steel tariffs, Cleveland Cliffs jumps 25%
Major steel stocks jumped Monday following President Donald Trump hiked tariffs tied to the metal.
Shares of mining company Cleveland-Cliffs popped roughly 25% in premarket trading following the announcement, while Steel Dynamics and Nucor each jumped more than 10%. The VanEck Steel ETF (SLX) added 1.9%.
Trump said Friday at a Pennsylvania rally he would to double tariffs on steel imports to 50% from 25%, a move that inflamed trade tensions again and drew criticism from global partners.
"We are going to be imposing a 25% increase. We're going to bring it from 25% to 50% — the tariffs on steel into the United States of America, which will even further secure the steel industry in the United States," Trump said.
To be sure, Europe responded to the higher tariffs by saying on Saturday that Trump's plan "undermines ongoing efforts to reach a negotiated solution" and that the "the (European Union) is prepared to impose countermeasures."
Trump on Friday also hailed what he called a "blockbuster agreement" between U.S. Steel and Japanese steel giant Nippon Steel.
He promised during the rally that U.S. Steel would be "controlled by the USA" and that no layoffs would occur. But Trump has refrained from calling the deal a merger, previously saying the "partnership" it will create at least 70,000 jobs to the U.S. economy.
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Cleveland-Cliffs recently announced its earnings for Q1 2025, reporting a decline in sales and an increased net loss compared to the same period the previous year. Despite these financial challenges, the company's stock moved up by 19% over the past week, in contrast to the broader market's modest 2% climb. This significant price movement for Cleveland-Cliffs, given its recent earnings report, suggests other influences may have been at play, potentially offsetting the financial performance impact, as no major market news accompanied this period. Cleveland-Cliffs has 3 possible red flags (and 1 which is potentially serious) we think you should know about. These 18 companies survived and thrived after COVID and have the right ingredients to survive Trump's tariffs. Discover why before your portfolio feels the trade war pinch. The news of Cleveland-Cliffs' improved share price performance following a challenging earnings report highlights the complex dynamics influencing investor sentiment. While the company's Q1 2025 earnings showed a US$1.18 billion loss, the recent tariff-backed protection and expectations of synergies from the Stelco acquisition may bolster its future prospects. This optimism is reflected in the significant 19% share price increase, despite short-term financial setbacks. Over the past five years, Cleveland-Cliffs delivered a total return of 10.69%, including share price and dividends—a modest gain considering the stock's recent volatility. In contrast, the company's performance in the past year lagged behind both the US market return of 11.9% and the US Metals and Mining industry return of 0.4%. These figures indicate that while Cleveland-Cliffs has experienced recent positive momentum, it trails industry and market averages over the longer term. The potential impact of the tariff and acquisition news on revenue and earnings forecasts is significant. Analysts anticipate an annual revenue growth of 5.2% over the next three years and a shift from a 3.9% decline in profit margins to a 2.2% gain by 2028. However, this optimistic outlook is tempered by existing risks, including trade disruptions and high interest rates, which could impede the company's progress. With the current share price at US$8.61 and a consensus price target of US$10.91, the stock has room to grow, with a potential upside of 21.1%. However, the analysts' divided perspectives on Cleveland-Cliffs' future highlight the uncertainty ahead. Investors are encouraged to scrutinize these projections against personal expectations and market conditions. Understand Cleveland-Cliffs' track record by examining our performance history report. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include NYSE:CLF. This article was originally published by Simply Wall St. Have feedback on this article? Concerned about the content? with us directly. Alternatively, email editorial-team@
