Posco Rises After U.S. Steel Forecasts Higher Quarterly Profit

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30 Jul 2008

Posco, Asia's biggest steelmaker by value, rose the most in more than two months in Seoul trading on optimism U.S. Steel Corp.'s earnings forecast indicates higher profit for the industry. Posco climbed as much as 4.6 percent, the most since May 15. The shares traded at 524,000 won, up 4.4 percent, at 11:27 a.m. in Seoul today. The benchmark Kospi index rose 0.7 percent. U.S. Steel, the nation's second-largest steelmaker by value, said yesterday profit more than doubled in the second quarter, beating analysts' estimates, after increasing prices. Chief Executive Officer John Surma said the company expects ``another excellent quarter'' with higher earnings, without giving details.
``Steel stocks have been in the doldrums recently because investors were concerned earnings may deteriorate in the second quarter,'' Chung Ji Yun, an analyst with CJ Investment & Securities Co., said in Seoul. ``U.S. Steel's good second-quarter results and positive projection dispelled the concerns, helping Posco shares.'' She has a ``buy'' rating on Posco.
Hyundai Steel Co., South Korea's second-largest steelmaker, rose 2.6 percent to 68,300 won. Dongkuk Steel Mill Co. gained 3.1 percent to 47,650 won.

Source: Bloomberg