What happened

Metals-producing companies saw their stocks rebound on Friday from Thursday's sharp sell-off, with shares of steelmakers ArcelorMittal (NYSE:MT) rebounding to post an 8.4% gain, U.S. Steel (NYSE:X) rising 10.8%, and aluminum giant Alcoa (NYSE:AA) closing up 10.7%.

There was no news to explain the rebound, however. And no reason, either. 

Arrow angles up on a green stock chart.

Image source: Getty Images.

So what

Well, no logical reason, at least.

You may recall that, back in May, we saw a sharp spike higher in the prices of aluminum stocks on news that China, which was first hit by coronavirus and also first to see its economy emerge into the aftermath, had begun importing metals to support its rebound. That news is still less than two weeks old, and on Thursday, The Economist magazine confirmed that "the spectacular rally in metal prices" is ongoing even now, with prices of not just aluminum but iron ore, too, up 25%.

But here's the thing: The Economist report on the spike in metals prices came out Thursday -- the same day that Arcelor shares fell 9%, Alcoa 14%, and U.S. Steel 17%! Logically, if those shares were going to move higher, they should have done so in response to the good news on metals prices.

Now what

Instead, metals stocks crashed Thursday and only recovered when the rest of the market began to recover, i.e., Friday. And to me, that makes today feel a bit more like a "dead cat bounce" in the stocks' prices than a real and sustainable rally.

Could I be wrong about that? Could metals stocks continue moving higher in the days and weeks to come?

Of course I could -- and they could. But with coronavirus not yet solved, the recession that began in February still not over today, and most pertinently, with Alcoa carrying $1.1 billion in net debt, U.S. Steel owing $3.6 billion, and Arcelor a staggering $9.5 billion, I fear these three stocks are far from out of the woods just yet.