Will there be a truce, a deal or a further breakdown? All eyes are on this weekend’s G-20 showdown between President Donald Trump and Chinese leader Xi Jinping. For investors on edge about the trade outcome, here are the make-or-break stocks with the most to win or lose, according to Goldman Sachs.
The bank screened Russell-1000 Index member companies for those with high revenue exposure to Greater China, using 2018 company filings.
The list is concentrated in chipmakers including Qorvo, Qualcomm, Micron Technology, Nvidia, Broadcom and Intel. Semiconductors are already under pressure after the Trump administration blacklisted Chinese telecom giant Huawei, a big customer of U.S.-made chips. Nvidia has fallen nearly 9% this quarter, and Micron, while surging double-digit on its earnings on Thursday, is still down more than 7% in the past three months.
The YUM! spin-off Yum China has 100% of its sales from China, while casinos Wynn Resorts and Las Vegas Sands are also heavily relying on their revenue in China. Fiber laser manufacturer IPG Photonics, integrated power solutions company Monolithic Power Systems, supplier of automatic test equipment Teradyne are also on Goldman’s list.
Investors have been eyeing the G-20 meeting as the next biggest market risk after the Federal Reserve opened the door to an easier monetary policy, sending stocks to new highs. Major equity indices have been relatively muted this week as traders awaited the key meeting on Saturday.
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Xi was reportedly prepared to present terms of an agreement but that China wanted a deal with “balance, ” which the U.S. has no interest in.
Major Wall Street banks generally have low expectations, seeing a cease-fire as the most likely outcome this weekend, a result that could cause a relief rally in these names.
— CNBC’s Michael Bloom contributed reporting.