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Back to basics...steel, not social

'The secret of steel has always carried with it a mystery. You must learn its riddle, Conan. You must learn its discipline.'
Source: Universal Pictures | YouTube
'The secret of steel has always carried with it a mystery. You must learn its riddle, Conan. You must learn its discipline.'

Can a "like" build a skyscraper? Can a "retweet" plow a farm? Does "friending" make sturdy cars?

No. They do not. And the market seems to be wising up to that fact.


U.S. Steel posted solid earnings last night and the market rewarded it this morning with a 7 percent stock pop. Indeed, with housing construction appearing to be on an upward trend and automobile sales booming, the outlook for steel looks optimistic. Other industrials like Caterpillar and Dupont seem to be benefiting as well. Even Alcoa, kicked out of the Dow for being less relevant to the economy, has been on a roll.

Compare this to the more trendy stocks like Facebook and Twitter. Their prospects depend on growth, which depends on their own innovation. Their earnings reports raised doubts about each and their stocks have suffered.

"I think domestic manufacturers are doing quite well. Domestic productivity continues to improve," said independent investment advisor Rich Bernstein. "...If we're talking social media, I have no interest. They are extraordinarily overvalued and people think they are safe havens."

Sure, there are plenty of things to disrupt industrials in general and steel in particular. Much of their fortune hangs on China's economic condition, for example. But for the time being it's gratifying to see some of the more traditional types of business back in the market's good graces.