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 & Mining, Sector ETFs, Steel