2023-03-17 10:45:52 ET
It wasn't just bank stocks that had a rough and turbulent week. Steel stocks don't necessarily have a direct correlation to the financial sector and the regional banks that dominated the news this past week. But the share prices of leading domestic steelmakers Nucor (NYSE: NUE) , Cleveland-Cliffs (NYSE: CLF) , and Steel Dynamics (NASDAQ: STLD) also tanked this week.
As of early Friday morning, Nucor and Cleveland-Cliffs had each dropped about 8% since last week's close, and Steel Dynamics was lower by about 12%, according to data provided by S&P Global market Intelligence . But those stocks could be set to rebound after peer U.S. Steel (NYSE: X) released an optimistic business forecast Thursday night.
Even though there isn't a direct line from banks to steel, it makes some sense that investors connected them tangentially. If turmoil in the financial sector means a recession is more likely in the near future, companies in cyclical industries like steel could quickly see their businesses taper off. And steel stocks had also enjoyed a good run over the last six months, so a bit of a correction might seem warranted. But there are also signs that steelmakers' operations are still busy and benefiting from economic expansion.
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Why Nucor, Cleveland-Cliffs, and Steel Dynamics Plunged This Week