U.S. Steel stock jumps following Trump’s re-election, uncertainty remains

United States Steel Corporation (NYSE: X) experienced a significant stock rally of over 12 percent as President Donald Trump secured a second term, with the Associated Press calling critical swing states like North Carolina, Georgia, and Pennsylvania in his favor. Trump's re-election has fueled investor hopes for renewed tariffs and tax policies benefiting U.S. manufacturers, especially in the steel industry.

Despite these gains, U.S. Steel shares remain below the $55-per-share offer from Japan’s Nippon Steel, which has proposed a $14 billion takeover. Political resistance to the acquisition has been pronounced, with Trump calling it a “psychologically” difficult scenario for an iconic American firm to be foreign-owned. Nippon’s commitment to invest billions into U.S. Steel's domestic operations highlights potential benefits, yet regulatory approval remains uncertain.

U.S. Steel CEO David Burritt, in comments reported by The Wall Street Journal, has warned that failing to secure investment could lead to plant closures and even relocating the company’s Pittsburgh headquarters. Meanwhile, BMO Capital Markets recently revised its price target for U.S. Steel from $45 to $43, citing demand concerns, though it upheld an Outperform rating. Despite surpassing third-quarter earnings estimates, the company projects a lower fourth-quarter EBITDA, reflecting ongoing market challenges.

As Investing.com detailed, U.S. Steel has also marked milestones like the first coil production at Big River 2, yet faces headwinds from fluctuating steel prices and global competition. With Trump’s policies poised to impact the industry once more, and the Nippon deal in limbo, the company’s future remains finely balanced between political and market forces.

Sources: MSN, WSJ, Investing.com, Photo: Fotolia