FRANKFURT (dpa-AFX) - Shares of Salzgitter reached their highest level since summer 2023 on Thursday morning, climbing to 35.20 euros. The steelmaker's stock has now accumulated a 120 percent gain for the year. The rally followed a strong surge the previous day, triggered by a buy recommendation from Deutsche Bank. Overall, Salzgitter is benefiting from expectations of a more protectionist trade environment in Europe, with lower steel import quotas and the prospect of potential business in Ukraine once the war comes to an end.
The latter factor had already boosted steel stocks at the start of the year and has resurfaced as a topic with the latest U.S. plans, wrote analyst Maxime Kogge of investment bank Oddo BHF. Reconstruction in Ukraine will require vast quantities of steel, although precise estimates are difficult to make. Based on World Bank projections, the figure could be around 100 million tons of steel.
Ukrainian manufacturers are likely to benefit most, along with ArcelorMittal, which operates plants in the country, Kogge noted. The impact on the rest of the industry is harder to predict. However, these developments generally improve sector prospects, in addition to German infrastructure spending and increased defense investments. Alongside Salzgitter, Kogge also mentioned Swedish company SSAB and Austria's Voestalpine as key players./ag/jha/
