Shares in steel group Nucor (NUE) rose nearly 2% today after President Trump firmed up plans to impose 25% tariffs on US metals imports.
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“No Exceptions” to Tariffs
Nucor climbed to $139.81 in pre-market trading continuing to forge higher after closing up nearly 6% on Monday. It was boosted by Trump’s declaration that a 25% import tax on all steel and aluminium entering the US would come into effect this March. He warned that there would be no exceptions to the rules which he hopes will boost domestic production. Currently the US is the largest steel importer in the world with its top three suppliers being Canada, Mexico and Brazil. “This is a big deal, the beginning of making America rich again,” Trump said. “Our nation requires steel and aluminium to be made in America, not in foreign lands.”
It was not just Nucor benefiting from the news. Cleveland-Cliffs (CLF) whose stock jumped nearly 20% on Monday was up 4% in pre-market trading. U.S. Steel (X) was 1% higher and Steel Dynamics (STLD) up nearly 2%.
Is Tough Talk a Tactic?
Some analysts however are still wary about whether Trump’s tough talk on tariffs is just that given his previous track record of changing his mind or altering strategy. Jane Foley, head of FX Strategy of Rabobank told the BBC. “The market I think is beginning to wonder, to what degree is this a negotiation tactic by Trump or to what degree is he really willing to push these tariffs through?”. The plans are also likely to be met with retaliatory measures from the EU and others which could hit US steel exports and consumer demand. Nucor was also lifted by a new Buy rating from J.P. Morgan and a $150 price target.
Is NUE a Good Stock to Buy?
On TipRanks, NUE has a Moderate Buy consensus based on 5 Buy and 4 Hold ratings. Its highest price target is $190. NUE stock’s consensus price target is $156.25 implying an 13.61% upside.
