Arcelor Mittal – Steel Strong

Roger Guy and Guillaume Rambourg, co Managers of Gartmore’s £2bn Gartmore European Selected Opportunities Fund include steel-maker Arcelor Mittal in their top ten holdings.

Investors are currently preoccupied with the current market turmoil, concerned that the widening credit crunch may impact economic growth and hurt corporate earnings. “The steel industry has not been immune to the market rout, and it is likely that the market will take some time before it eventually rebounds with some conviction. However, with strong results and analysts and steel producers alike anticipating a continued upward trend in steel prices, the mid to long term prospects for steel companies look attractive in this increasingly volatile and difficult environment”, according to Roger Guy and Guillaume Rambourg.

Strong global demand continues to make steel an attractive investment, with the steel industry riding on the crest of Chinese demand, projected at 8% by 2010 – double that of projected growth elsewhere. Shares in Arcelor Mittal have recently risen after analysts raised their recommendation on global steel stocks saying fundamentals underpin the industry.