Chinese President Xi Jinping and members of Chinese delegation attend a working dinner with U.S. President Donald Trump after the G20 leaders summit in Buenos Aires, Argentina December 1, 2018.
Kevin Lemarque | Reuters
Losses amid the nation’s blue-chip Dow stocks are starting to show Wall Street’s concerns for companies with significant exposure to the Chinese market.
While the Dow Jones industrial average is down about 1,200 points — more than 4% — since President Donald Trump announced last week an increase to tariffs on Chinese goods, the decline has been concentrated among a select few equities.
Intel, Apple and Caterpillar have all dropped more than 10% in the six trading days since the president’s tweet on May 5, when he said that levies on $200 billion of imported goods from China would climb to 25% from 10%. Beijing responded in kind on Monday, saying it would hike taxes on $60 billion worth of U.S. imports, starting on June 1.
Intel in particular may be vulnerable to a deterioration in U.S.-China trade relations, which about 25% on its sales coming from China, according to FactSet data. China represents about 18% of revenues for Apple and 5% for equipment and machinery giant Caterpillar.
Intel fell 2.7% Monday, while Apple dropped 5.4% and Caterpillar lost 5%.
Global aircraft manufacturer and U.S. industrial gem Boeing also slid to start the week, down more than 4% in midday trading. The equity is underperforming the Dow in 2019 thanks to concerns over two fatal crashes involving its 737 Max plane. It also generates about 13% of its total sales from China.
Boeing, Caterpillar, 3M, Goldman Sachs and Apple fell into bear market territory Monday, joining Intel and Walgreens Boots Alliance with more than 20% declines from recent highs.
Meanwhile the insurer UnitedHealth Group, a largely domestic business not beholden to the global economy, is still in the green.