Thyssenkrupp Shares Ride a Two-Track Rally as Tariff Chaos and a Raised Outlook Converge

Thyssenkrupp shares climb 18% as earnings upgrade and trade war rotation boost steelmaker, despite persistent losses and cash outflow.

The steelmaker's stock has become an unlikely beneficiary of a global trade war that most investors assumed would crush cyclical industries. Over the past month, Thyssenkrupp shares have climbed 18 percent, closing Wednesday at €14.36 — a mere 0.7 percent below the 52-week high of €14.45. The move has been powered by two distinct forces: a company-specific earnings upgrade and a sector-wide rotation into European industrials as Washington and Ottawa escalate their tariff battle.

A Forecast Lift That Came With Fine Print

The company's own catalyst arrived on August 13, when Thyssenkrupp raised the lower end of its full-year adjusted EBIT guidance to €600–900 million, up from a previous range of €500–900 million. Third-quarter revenue expanded 8 percent to €8.8 billion, while adjusted EBIT jumped 18 percent to €183 million and net income came in at €34 million.

Yet the headline numbers flatter the underlying picture. Over the first nine months of fiscal 2025/2026, the group still posted a net loss of €311 million, with adjusted EBIT of €591 million. In other words, virtually the entire year's earnings performance has already been banked — the fourth quarter merely needs to confirm what the first three delivered. Management has left its revenue forecast unchanged at minus 3 to minus 1 percent and continues to guide for negative free cash flow before M&A of minus €600 million to minus €300 million.

The sustainability question is therefore pointed: can the earnings improvement from Steel Europe, Marine Systems and Materials Services hold up even as sales shrink and cash continues to bleed out of the balance sheet?

Brussels Backing in the Wings

Adding to the bullish narrative, Reuters reported that the group is close to reaching an agreement with Brussels over state aid for its roughly €3 billion green steel project. The chief financial officer has described such a deal as defusing the uncertainty surrounding the largely grant-funded venture — though the agreement has not yet been finalized.

The technical picture reinforces the optimism. The stock trades 39 percent above its 200-day moving average and has appreciated 60 percent over the past twelve months, suggesting the market is already pricing in a structural improvement that needs to be validated by further positive news flow.

The Trade War Tailwind

Wednesday's session, however, pointed to a broader dynamic at work. Thyssenkrupp advanced 4.7 percent, but it was far from alone. Salzgitter jumped more than 9 percent, with voestalpine and ArcelorMittal also posting solid gains. The DAX barely moved, yet cyclical stocks — the most sensitive to economic conditions and trade policy — were the day's most sought-after names.

The logic runs counter to conventional wisdom. Canada has imposed retaliatory duties of up to 50 percent on US imports effective September 8, while Washington threatens 50 percent tariffs on autos and steel starting January 2027. The US has already levied 50 percent duties on C$20 billion worth of Canadian goods over the weekend. Rather than punishing European producers, investors appear to be betting that trade diversion will hand them market share as the US and Canada tie each other in knots.

A Rally That Runs Ahead of Fundamentals

The momentum is striking: 13 percent over seven days, 18 percent over a month. But the move is increasingly story-driven — restructuring, portfolio cleanup, a sector suddenly recast as a winner in a geopolitically fragmented trading system — rather than a reflection of operational progress that has yet to show up on the bottom line.

The RSI at 68.1 signals overbought conditions vulnerable to a pullback if the news flow disappoints. Annualized volatility of 43 percent cuts both ways. Should the Brussels agreement stall or collapse, the financing uncertainty around the green steel project would resurface in full force.

The next concrete test comes at the close of fiscal 2025/2026, when investors will see whether the raised EBIT floor of €600 million is actually met — and whether the market's enthusiasm for European steel was a genuine repricing or just a trade-war mirage.