Shares of U.S. steel and aluminum companies soared in premarket trading on Monday following President Donald Trump’s announcement of a sweeping 25% tariff on all steel and aluminum imports. The tariffs, which will apply to imports from all countries, including key trading partners like Canada and Mexico, were revealed during a conversation with reporters aboard Air Force One on Sunday.
Trump stated, “Any steel coming into the United States is going to have a 25% tariff,” adding that aluminum imports would also face the same penalty. This move is part of a broader plan to impose “reciprocal tariffs” later in the week, targeting products from countries that levy duties on U.S. goods.
Steel and aluminum stocks surged in premarket trading following President Donald Trump’s announcement of a 25% tariff on all steel and aluminum imports. Cleveland-Cliffs Inc. (CLF) and Nucor Corporation (NUE) both rose nearly 8%, while United States Steel Corporation (X) climbed over 5%. Steel Dynamics Inc. (STLD) gained more than 6%, and aluminum producer Alcoa Corporation (AA) advanced by 4.4%. The broader market also reacted positively, with S&P 500 and Nasdaq 100 futures increasing by 0.4% and 0.65%, respectively, as investors anticipated significant benefits for domestic industries from the tariff measures.
The tariffs are expected to bolster U.S.-based steelmakers by reducing competition from cheaper foreign imports. Jeremy Flack, CEO of Flack Global Metals, remarked that the measures could help address “unfairly priced steel from other countries” and create a more level playing field for domestic producers. However, analysts at JP Morgan noted that while the tariffs might drive up domestic production, they could also lead to higher costs for industries reliant on imported metals.
For aluminum, JP Morgan estimates the tariff could increase prices by nearly $0.30 per pound, excluding transportation and other costs. This could temporarily strain industries dependent on imported aluminum but may encourage long-term growth in domestic production.
The tariff announcement comes amid heightened global trade tensions and ahead of Federal Reserve Chair Jerome Powell’s congressional testimony this week. The move is seen as part of Trump’s broader strategy to protect U.S. industries and address trade imbalances.
While the immediate market response has been positive for U.S. metal producers, questions remain about the long-term impact on downstream industries and international trade relations.
