April 16, 2008 at 1:00 pm by Tom Lydon
The broader markets have been shifting all over for the first half of 2008, while the steel sector has remained solid, helping to anchor the related exchange traded fund (ETF).
Market Vectors Steel (SLX) is up 10.8% year-to-date and in the last three months has soared 22.5%, thanks to strong holdings that are trading at or near their 52-week high. Over the last year, the fund has jumped up 61.4%.
Rio Tinto (RTP), Companhia Vale Do Rio Doce (RIO) and Arcelor Mittel (MT) account for 40% of the fund’s assets. Billy Fisher for The Street adds that U.S. steel demand is up around 30% ahead of its supply and the dollar continues to weaken, making conditions fertile for these companies. So can the momentum continue?
Steel demand should maintain its upward growth because emerging markets continue to seek out the metal as they build up new cities. The only factor that might put a stop to this is if the U.S. economic downturn hits some of the overseas markets.
Tags | Material ETFs, Metals, Steel
April 16th, 2008 at 11:43 pm
Csx is one of my favorite but I have never seen it listed in your news letter . What do you know about it ?
April 21st, 2008 at 3:21 pm
Jim,
We currently focus most of our coverage on domestic exchanges and ETFs, so we don’t have any information on CSX. Sorry!