Without any company earnings or industry news to speak of, the general assumption is that big money is getting ahead of a possible infrastructure plan from President Trump. The president is slated to deliver an initial budget proposal today, which reportedly includes deep cuts to Medicare. From the New York Times:
The document, grandly titled “A New Foundation for American Greatness,” encapsulates much of the “America first” message that powered Mr. Trump’s campaign. It calls for an increase in military spending of 10 percent and spending more than $2.6 billion for border security — including $1.6 billion to begin work on a wall on the border with Mexico — as well as huge tax reductions and an improbable promise of 3 percent economic growth.
Today’s rally in steel names follows last week’s major midweek market pullback amid impeachment worries, which seem to have firmly dissipated now.
Steel names showing strength today include: RS (up 4.2%), X (up 3.8%), SCHN (up 3.6%), STLD (up 3.2%), NUE (up 2.8%), and WOR (up 2.6%).
On the ETF side of things, the Market Vectors Steel ETF (NYSE:SLX) was trading at $37.36 per share on Tuesday morning, up $0.62 (+1.69%). Year-to-date, SLX has declined -1.14%, versus a 7.31% rise in the benchmark S&P 500 index during the same period.