2Q26 Previews – From Pull Forward to Pricing Power

Research evidence excerpt

2Q26 Previews – From Pull Forward to Pricing Power

Idea

June 28, 2026 08:00 PM GMT

Morgan Stanley & Co. International plc+MCarbon Steel | Europe Alain Gabriel, CFA

Equity Analyst

2Q26 Previews – From Pull Alain.Gabriel@MorganStanley.comIoannis Masvoulas, CFA +44 20 7425-8959

Ioannis.Masvoulas@morganstanley.com +44 20 7425-0427

Forward to Pricing Power Adahna Ekoku

Adahna.Ekoku@morganstanley.com +44 20 7425-0578

EU margin expansion has paused as the market works through Ferdinand Huber

an import-led restock. We view this dynamic as transitory; ResearchFerdinand.Huber@morganstanley.comAssociate +44 20 7677-2702

CBAM, tighter safeguards, and higher tariffs should reset price

Carbon Steel

formation as inventories clear. Spot is largely in estimates; the Europe

durable earnings re-base is not. Prefer MT/SZGG; SSAB still Industry View In-Line

screens best on spot. What’s Changed

SSAB AB (SSABa.ST) From To

Inventory digestion before the deficit bites. EU apparent steel demand has Price Target SKr 94.00 SKr 100.00

improved meaningfully over the past six months, but we see this as a policy-driven Salzgitter AG (SZGG.DE) From To

restock, not real demand recovery. Imports remained robust into the 1 July safeguard Price Target €70.80 €67.50

reset, while underlying demand has lagged, leaving the supply chain well covered.

This appears to follow the US tariff playbook, where buyers pull tonnes forward

ahead of expected trade measures, inventories build, prices soften into

implementation, and only then does the new import regime begin to reset the

regional price floor. We therefore view the recent pullback in EU HRC spreads as

transitory, with the policy architecture unchanged: CBAM addresses the asymmetry