U.S. Steel (X) Stock Falls as China Steel Futures Tumble Further
NEW YORK (TheStreet) -- U.S. Steel (X) - Get Report stock is down by 4.32% to $14.16 in late-morning trading on Friday, as China's steel and iron ore futures continue to fall on concerns about oversupply.
Iron ore closed down by 5.2% to 363 yuan ($55.68) per metric ton, steel rebar finished down by 4.6% at 2,030 yuan per metric ton and hot-rolled coil ended down 4% at 2,195 yuan per metric ton today, the Wall Street Journal reports.
Prices have been weighed down by worries about excess supply.
Chinese steel mills upped their output last month with the hopes that the government's stimulus measures would spark demand from housing and infrastructure sectors. But a local article published on Monday diminished expectations for sustained stimulus in the property sector.
"The message from Beijing early this week suggests a slimmer chance of further easing, which hurt sentiment and triggered panic selling in steel-related commodities," Wang Ying, an analyst at CCB Futures, told the Journal.
The lower prices also reflect regulators' indications on Monday that they would step up their efforts against speculative trading, which has been cited as the reason for the sharp rise in prices.
Separately, TheStreet Ratings team rates the stock as a "sell" with a ratings score of D.
U.S. Steel's weaknesses include its deteriorating net income, generally high debt management risk, disappointing return on equity, weak operating cash flow and generally disappointing historical performance in the stock itself.
You can view the full analysis from the report here: X
TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this article's author.
