NEW YORK (TheStreet) -- Steel stocks such as AK Steel (AKS), U.S. Steel (X), and Nucor (NUE) gained 6.4%, 4.7%, and 4.3%, respectively, last week boosted by China's better-than-expected industrial data. These stocks were a part of our article on steel stocks from Thursday.
AK Steel last week announced a $40 per ton price increase for carbon steel products in response to growing demand as well as the need to recover higher costs for steel-making inputs. Meanwhile, for the week ended Sept. 3, capacity utilization for the steel industry rose to 70.6% from 70.2% while production increased 0.6% to 1.71 million tonnes, according to data released by the American Iron and Steel Institute.
Other stocks including Alumina (AWC), Pan American Silver (PAAS), North American Palladium (PAL), and Patriot Coal (PCX) rose 4.8%, 5.9%, 9.4%, and 7%, respectively. This increase compares to a 0.5 gain in the S&P 500.
North American Palladium gained the most. Last week, Macquarie initiated coverage on the stock assigning an outperform rating and a target price of $4.35, implying a 20% upside over current levels.Patriot Coal, which gained 7%, however could face headwinds. The company cut its third-quarter 2010 sales volume estimate to 7.5 million and 7.7 million, down 10% from prior estimates. The company cited sporadic downtime at the Federal and Panther longwall operations, difficult geological conditions during the quarter at the Wells and Big Mountain complexes, and continued heightened regulatory oversight as the reasons for lower volume. Meanwhile, Alumina CEO John Bevan told Mining Weekly he expects global alumina demand to grow 12% year-over-year during 2010 due to increased demand from China.
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