Easyturn The growth outlook in China has improved decisively, according to the Goldman Sachs equity strategy team. “The sudden reversal of China’s long-standing zero covid policy means the country is reopening more swiftly than expected,” strategist David Kostin wrote in a note. “Our China economists now expect GDP growth of 5.5% in 2023 (vs. 4.5% just two months ago).” “Baskets of companies with foreign revenue exposure have outperformed alongside the brightening global growth outlook and FX weakness,” Kostin said. “The China Sales Exposure basket contains Russell 1000 (NYSEARCA:IWB) companies with the highest sales exposure to China.” “Its performance vs. the S&P 500 (SP500) (SPY) has followed the path of USD (DXY)/CNY (CYB), outpacing the index by 5 pp YTD as the dollar has declined.” Stocks in the China Sales Exposure Basket with a market cap above $10B: Monolithic Power Systems (MPWR), % of sales in Greater China 72%, Non-U.S. sales 97% Qualcomm (QCOM), 67%, 96% Las Vegas Sands (LVS), 67%, 100% Nvidia (NVDA), 58%, 84% Texas Instruments (TXN), 55%, 90% Applied Materials (AMAT), 53%, 91% KLA (KLAC), 51%, 89% Lam Research (LRCX), 50%, 95% Teradyne (TER), 47%, 89% Western Digital (WDC), 47%, 78% Qorvo (QRVO), 46% 59% Marvell Tech (MRVL), 44%, 89% Intel (INTC), 44%, 82% Micron (MU), 42%, 56% Wynn Resorts (WYNN), 41%, 41% Corning (GLW), 39%, 68% NXP Semi (NXPI), 38%, 91% AMD (AMD), 38%, 72% Microchip Technology (MCHP), 38%, 72% Estee Lauder (EL), 36%, 79% Broadcom (AVGO), 36%, 81% Expeditors (EXPD), 31%, 74% Aptiv (APTV), 31%, 65% Amphenol (APH), 28%, 71% Skyworks Solutions (SWKS), 27%, 37% Tesla (TSLA), 26%, 55% DuPont (DD), 24%, 74% BorgWarner (BWA), 24%, 83% TE Connectivity (TEL), 22%, 76% Analog Devices (ADI), 22% 67% Mettler-Toledo (MTD), 20%, 67% Agilent (A), 20%, 66% Otis (OTIS), 20%, 74% Avery Dennison (AVY), 20%, 75% Tapestry (TPR), 19%, 41% Celanese (CE), 19%, 77% Keysight (KEYS), 19%, 64% Waters (WAT), 19%, 72% Apple (AAPL), 19%, 63% Nike (NKE), 19%, 61% Air Products & Chemicals (APD), 18%, 61% Albemarle (ALB), 18%, 76% Jabil (JBL), 16%, 84% PerkinElmer (PKI), 13%, 60% Cummins (CMI), 13%, 48% MGM Resorts (MGM), 13%, 13% Starbucks (SBUX), 13%, 30% Fortive (FTV), 12%, 49% Emerson Electric (EMR), 12%, 56% 3M (MMM), 11%, 58% See why Barclays argues that China’s reopening won’t have much effect on U.S. stocks.
