[I]f you believe the Swiss broker, there is more upside to come. ‘Calling the top of the steel cycle would appear to be premature. In our view, we could be about to pass through the trough of a mini-cycle in the US and Europe, with the best still to come,’ it said.
Although many in the investment community expect steel prices to start to fall during the second half of the year, the broker is convinced this will not happen. CSFB said: ‘Steel prices collapse when the export market is deeply liquid, triggered by a global de-stocking or a major regional crisis. We see neither of these on the horizon’.
Also supporting Corus yesterday were ultra-bullish comments from the management of its peer ThyssenKrupp. Jost Massenberg, an executive at the German group, told a German newspaper that he expects steel prices to rise sharply in the coming months and indicated that such is the demand the company faces for its products at present that it is struggling to satisfy it.