Things are looking up for steel ETFs. The possibility of a rebound within global economies and the U.S. has steelmakers expanding operations and re-hiring in hopes of getting an early jump on resurgent demand.
The steel ETF might be flat year-to-date, but if signs of life in steel plants are any indication, it may not stay that way for long.
- Robert Guy Matthews for The Wall Street Journal reports that ArcelorMittal (MT), the world’s largest steelmaker, said last week that it would restart production at a major operations center in Indiana. That plant makes steel for nearly all markets.
- U.S. steel mills are operating currently at between 70% and 75% of capacity, two-thirds busier than at the start of 2008 when operating rates were hovering between 40% and 45%. At those rates, steelmakers could return to profitability this quarter.
- Another surprising source of growth for the steel industry is the natural gas industry. Thanks to the expanding use of the cleaner-burning fuel, new lines are needed to transport it and old ones need to be replaced, reports Kari Lydersen for In These Times.
- Market Vectors Steel (SLX)
- First Trust ISE-Revere Natural Gas (FCG)
- United States Natural Gas (UNG)
Disclosure: None
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