Key takeaways
- US Steel shares are in the spotlight after Nippon Steel's new president, Tadashi Imai, reiterated his intention to move forward with the politically sensitive acquisition.
- Imai said the acquisition would allow US Steel to leverage the Japanese company's advanced technologies and provide access to its 2,000 steel patents in North America.
- President Biden, along with several other lawmakers and union leaders, have rejected the proposed deal, raising concerns about national security and potential job losses.
- US Steel share price may find support around $38.50 near a key trend line and resistance near the gap high at $50.20.
United States Steel (x) stocks remain in the spotlight Monday after Nippon Steel (NPSCY), the Japanese steel company that agreed in December buys The $14.9 billion U.S. steel company reiterated its intention to move forward with the politically sensitive acquisition.
Nippon Steel's new president, Tadashi Imai, told reporters last week that an alliance with the Japanese steelmaker, which has had a presence in the United States since the 1980s, would help American steel accelerate its domestic growth. "I am convinced that we are the most useful partner to help US Steel grow in the United States," he said, according to a Reuters report on Sunday.
Imai discussed how the acquisition would allow US Steel to leverage Nippon Steel's advanced technologies, such as electromagnetic steel sheets, and provide access to its 2,000 steel patents in North America, adding that the proposed merger would boost US Steel's competitiveness. .
Last month, president bidenalong with several other legislators and Union leaders, rejected the deal, raising concerns about national security and possible job losses. In relation to the latter, the Japanese firm has said that there will be no layoffs or plant closures resulting from the transaction.
He take the control It is politically contentious in an election year in which both Biden and his rival, former President Donald Trump, will seek the support of steelworkers and unions in critical swing states, such as Pennsylvania, home of US Steel. The proposed purchase is currently being evaluated by the Committee on Foreign Investment in the United States (CFIUS) and will likely be discussed when President Biden meets with Japanese Prime Minister Fumio Kishida in Washington on April 10.
US Steel stock price breached over several years endurance following the news of the Nippon Steel acquisition, but has since filled the area with no price activity as investors wonder whether the deal will gain regulatory approval.
Looking ahead, it is worth keeping an eye on the key $38.50 level, an area on that chart that may generate buying interest near a trend line connecting the April 2022 high and the recent mid-March low. If the stock rises from these levels, watch the gap high at $50.20 as a possible resistance area where sellers may decide to take profits.
US Steel shares rose 0.4% to $40.96 in premarket trading on Monday around 7:00 a.m. ET.
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