The growing trade war has been making news headlines since it was first hinted at by Pres. Donald Trump. It has been stated that the ramifications of this trade war could be anything from a new recession to enhanced growth and all of the industries in the United States of America. Paul Mampilly believes that the truth lies somewhere in the middle. While there are several unique investment opportunities that have presented themselves as a result of the decision to initiate a trade war between the United States and China there are also several companies which will likely be hit fairly hard by the effects of the trade war.
Paul Mampilly believes that it is important to invest wisely and know which stocks to sell in order to successfully navigate the economic ramifications of the trade war between the United States and China. There are a few stocks that are fairly popular which Paul Mampilly believes will be hit harder than others by the effects of this trade war. One of the most popular stocks is that of Boeing. It is fairly overexposed in the Chinese markets as it generates about 13% of its sales from China and has had plans to sell nearly 30% of the new 737 jets to China. There are several competitors that China will easily be able to switch to and this will have devastating effects on the stock price of Boeing.
According to Paul Mampilly, Apple computers will also be a stock that is hit fairly hard. Almost 25% of the company’s sales are directly from China in addition to the company using China as its manufacturing center. This makes the company very exposed to potential downturns from lowered participation by Chinese consumers. Another company which might potentially be hit fairly hard by the trade war between the United States and China is Starbucks. There are over 1500 stores in China which represents nearly 6% of the total stores that are operated by the company. China has been the largest growing market for the company for several years so a trade war between the United States and China means bad news for the company’s stock price.
Sources of the article : https://www.crunchbase.com/person/paul-mampilly