U.S. steelmakers and aluminum producers rebounded off Friday’s lows on optimism that North American allies will implement stronger measures that will prevent excess supply from flooding their domestic markets.

The Trump administration is poised to lift steel and aluminum tariffs on Canada and Mexico in favour of stronger enforcement actions, according to people familiar with the matter. The move helps clear the way for the ratification of USMCA which replaces the old North American Free Trade Agreement.

A S&P gauge of 13 steelmakers pared losses to 1.9 per cent at 11:23 a.m. in New York. The index was down as much as 3.3 per cent earlier. Alcoa Corp. (AA.N), the largest U.S. aluminum producer, was down 0.8 per cent, after sliding as much as 2.4 per cent earlier.