NEW YORK (
TheStreet) -- Investors unloaded shares of steelmaking concerns Tuesday after one of its bellwethers,
(X), appeared to toss a wet blanket on hopes of a speedy recovery in the industry.
The Pittsburgh company, along with Ohio's
(AKS - Get Report), surpassed bottom-line expectations for their just-ended periods, with the former reporting a
narrower-than-expected loss and AK swinging to a
thin profit after losing money for three consecutive periods.
But U.S. Steel in particular offered a view of its business over the near term that appeared to show that some market expectations for steel producers may have been out of whack with reality.
One of the more pertinent lines from the company's press release read: "We remain cautious in our outlook for end-user demand as order rates
in flat-rolled steel and in European markets
have decreased from the third quarter, partly due to seasonal slowdowns, and we will continue to adjust production to meet our customers' demand."
Though the fourth-quarter typically marks a natural weakening in steel demand, business has been so anemic of late that seasonality "should be less of a factor," Michael O'Rourke, chief market strategist at the trading firm BTIG, said in an email.
He added that better-than-expected earnings from companies in other sectors early in the third-quarter reporting season "opened the possibility of a V-shaped recovery in earnings. In this industry's case, that possibility has been extinguished for the time being."
Tuesday afternoon, shares of U.S. Steel, which have been declining sharply since hitting a 52-week high of $51.65 in late September, dropped nearly 9%, or $3.50, to $37.08.