WASHINGTON—President Trump said he supported what he described as an emerging agreement that would allow Nippon Steel to invest in—but not fully own—U.S. Steel, potentially opening up a new path for the Japanese company to enter the American steel market.

President Trump supports the Japanese company’s taking a stake in the American steel maker after the U.S. blocked a $14 billion takeover bid.

Nippon Steel “is going to be doing something very exciting about U.S. Steel,” Trump said at a news conference with Japanese Prime Minister Shigeru Ishiba.