European steelmakers traded firmly higher Friday, with mining stocks following suit, after a jump in iron ore prices linked to a brewing trade dispute between the U.S. and China.

U.S. President Donald Trump said Thursday that he would launch an investigation into anti-competitive practices from China's steelmakers, whom he accused of dumping cheap exports into the American market, and hinted at possible tariffs in reply.

"Steel is critical to both our economy and our military," the President said. "This is not an area where we can afford to become dependent on foreign countries."

China market reaction, however, lifted iron ore prices by more than 6% to around $73.45 a ton and coking coal prices, a key ingredient in the steelmaking process, gained 5.5%.  European steelmakers surged in early Thursday trading, as well, with Germany's ThyssenKrupp AG (TKAMY) rising 1%, France's Vallourec SA (VLOWY) gaining 1.5% and Franco-Indian giant ArcelorMittal SA (MT) jumping 3.09%.

Mining and basic materials stocks were also on the rise, lead by a 2.6% gain for Rio Tinto plc (RIO) and a 1% advance for BHP Billiton plc (BHP) .

U.S. steelmakers surged in Thursday trading, as well, following the President's comments, which were supported by his Commerce Secretary, Wilbur Ross. The S&P Composite 150 Steel subindex gain 5.21%, its biggest gain since late November, thanks in part to significant gains for Nucor Corp. (NUE) (4.74%), AK Steel Holding (AKS) (8.6%) and Steel Dynamics (STLD) (6.8%).

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