Cleveland-Cliffs stock surges 27% as Trump aims to double steel tariffs

Cleveland-Cliffs (CLF) stock jolted higher on Monday as investors repositioned following US President Donald Trump's announcement late last Friday that he would double his existing 25% tariff rate on steel and aluminum imports to 50%. CLF stock rose 27% in Monday's premarket on the news.

The move would raise the prices for automobiles and many other consumer items that use either metal for packaging. Some economists even predict the tariff hike will bleed into grocery prices.

Competitors Nucor (NUE) and Steel Dynamics (STLD) both saw their share prices gain close to 12% at the same time. Dow Jones Industrial Average futures sank by a quarter percent, while NASDAQ and S&P 500 futures both shed 0.37% at the time of writing.

Air of uncertainty pervades Monday stock market news

The increased steel tariffs, which are likely to be felt in a host of industries, are not the only thing worrying investors. Over the weekend, The Wall Street Journal reported that the General Services Administration had sent a letter to 10 tech companies concerning their contracts with the federal government. Dell Technologies (DELL) and CDW Corporation (CDW) were among those that received the letter, which asked them to itemize their current contracts and look for savings, as well as justify the contract work.

Since the start of his administration, Trump's team has cancelled close to 11,300 contracts with saving circa $33 billion. Elon Musk, who headed the Department of Government Efficiency, exited the administration to focus on Tesla (TSLA) and his other companies last week. But the letter sent last Wednesday showcases the administration's aim to continue cutting government expenditures.

Another concern comes from the administration's tensions with China. Over the weekend, Defense Secretary Pete Hegseth told an annual defense summit, "We are reorienting toward deterring aggression by Communist China." Hegseth added that "the threat China poses is real, and it could be imminent."

The general unease sent US Treasury yields higher and Gold prices up more than 2% on Monday morning.

Cleveland-Cliffs stock forecast

CLF stock is rebounding hard after falling 65% over the past year. Part of that long decline was fallout from Cleveland-Cliffs failure to acquire US Steel, which was instead purchased by Japanese heavyweight Nippon Steel for close to $14.9 billion.

With CLF stock trading near $7.20 in Monday's premarket, the first target for bulls is the 23.6% Fibonacci Retracement at $7.45. The 38.2% Retracement sits at $7.79. The 50-day Simple Moving Average (SMA) drifts in between at $7.73.

CLF daily stock chart