Tags: goldman | trade war | world | economy

Goldman: CBS, Kohl's to Surge as US Rebounds From Trade War

Goldman: CBS, Kohl's to Surge as US Rebounds From Trade War
(Dreamstime)

Tuesday, 19 November 2019 09:10 AM

The trade war’s drag on the world’s largest two economies will gradually fade in 2020 as tariffs on imports from China have likely peaked, according to Goldman Sachs Group Inc.

Goldman Sachs believes certain stocks could have the most upside from the economic recovery, CNBC explained.

“The equity market is anticipating an acceleration in U.S. economic growth during the coming months,” David Kostin, Goldman’s chief U.S. equity, said in a note on Friday. “Investors who want to capture further cyclical upside can improve risk-reward by narrowing their focus to select cyclical stocks.”

Goldman screened Russell 1000 stocks for names with high economic sensitivity but still-depressed valuations. The bank found 24 stocks that could outperform the market and other cyclicals if economic growth continues to improve, CNBC said.

These stocks include:

The recent progress toward a partial trade deal and expectations of an extended truce implies that this drag will disappear, which will also benefit the global economy, Goldman Sachs economists led by Jan Hatzius wrote in a note dated Nov. 18. This assumes there is no further escalation of tariffs, Bloomberg said.

The trade war is currently subtracting roughly 0.5 percentage point from sequential growth in both the U.S. and China, according to Goldman’s estimates.

China’s economy has been on a gradual downward trajectory, with gross domestic product growth slowing further in the third quarter to 6%. Despite efforts by the government and central bank to stimulate the economy, growth is forecast to continue slowing to below 6% next year.

Material from Bloomberg and Reuters has been used in this report.

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The trade war’s drag on the world’s largest two economies will gradually fade in 2020 as tariffs on imports from China have likely peaked, according to Goldman Sachs Group Inc.
goldman, trade war, world, economy
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2019-10-19
Tuesday, 19 November 2019 09:10 AM
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