POSCO Shares Soar 7.64% on Trade Dynamics, Analyst Upgrade

POSCO (PKX) shares surged to their highest level since November 2024 today, with an intraday gain of 7.64%.

The strategy of buying PKX shares after they reach a recent high and selling them one week later resulted in a significant underperformance. The strategy returned -29.83% over the past five years, while the benchmark return was 58.96%. The strategy had a maximum drawdown of 0.00% and a Sharpe ratio of -0.33, indicating a high risk and a negative return relative to the benchmark.

POSCO's recent stock price increase can be attributed to several key factors affecting the steel sector. The volatility in the steel industry, driven by global trade tensions, has significantly impacted POSCO's performance. The EU's consultations on the Carbon Border Adjustment Mechanism (CBAM) and Canada's enforcement of tariffs have created a dynamic environment that has influenced the stock's upward movement.

Additionally, Morgan Stanley's upgrade of POSCO's shares from an "equal weight" to an "overweight" rating on July 4 has contributed to positive investor sentiment. This upgrade reflects the growing confidence in POSCO's prospects within the steel industry.

Global trade dynamics have also played a crucial role in POSCO's recent performance. The EU's import of 2.57 million tons of iron and steel products from Russia, along with the potential replacement of protective steel measures, has increased demand for global steel producers, including POSCO. These shifts in the global steel market have further bolstered POSCO's stock price.