Headline Edge: Which Stocks Have Been Most Impacted By The US-China Trade War?

With earnings season done, another government shutdown averted and the Federal Reserve signaling they plan on keeping interest rates steady for the time being, there’s only one lingering macroeconomic uncertainty hanging over the market heading into March, and that’s the U.S.-China Trade War.

Although the broad market has reacted to even the slightest rumor emerging from negotiations between the two countries, certain stocks have felt the impact of these headlines more than others. Using AI computational linguistics to extract meaning and interpret sentiment on headlines, articles and other relevant publications, the Yewno|Edge stock research platform allows traders to see which companies hold the highest degree of exposure to these latest trade developments.

The market received a boost in the most recent development in the trade spat from President Donald Trump’s Twitter, Inc. TWTR profile when he tweeted he plans on delaying a March 1 deadline on additional tariffs. However, with a true resolution to the conflict still uncertain, the market will likely see more volatility as negotiations between the world’s two largest economies continue into spring.

With the help of Yewno|Edge, we’ll take a look at some of the stocks whose performance have been most heavily influenced by their proximity to news, rumors and chatter surrounding the U.S.-China trade war and the talks to resolve it.

Between The Headlines

First, let’s examine which companies have news related to the trade war and how that news is influencing investor sentiment, which we can find by doing a concept search for “Trade War” through Yewno|Edge’s Key Developments tool.

A glance at the headlines following news of the tariff postponement shows that, despite the worries of slowing growth in China being exacerbated by the trade war, U.S. companies with exposure to China like Starbucks Corporation SBUX Walmart Inc. WMT and even Apple Inc. AAPL have reported healthy financial statistics and are still generally well-regarded by investors. Note the indicators to the right of each headline which show the stock impacted by the news as well as the degree to which sentiment is influencing them. The three headlines dealing with Starbucks, Apple and Walmart are each rated neutral to positive as far as their impact on those companies.

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On the other hand, the headline regarding soybeans and agricultural importer/exporter Bunge Ltd BG has a decidedly negative connotation for the company. Since agricultural and mineral commodities remain under direct and substantial tariffs, companies with exposure to commodities like soybeans, pork and aluminum still appear to be a liability.

We can dig into this relationship further by visiting the company information page on Bunge, shown below.

Among the first elements to pop out from this page are the negative sentiment ratings on Bunge in the bottom left corner from two recent headlines. Neither one is directly related to U.S.-China trade relations, but both speak to pressures the company is facing within the commodity industry, the first being an agribusiness report with a negative mention of Bunge and the second being a recent downgrade to the stock from Zacks Equity Research.

Based on that search, it would appear that Bunge is more exposed to trade headlines. But measuring it against three consumer stocks isn’t the best comparison. Let’s see how Bunge’s exposure compares with its peers.

We can do that by using Yewno|Edge’s Strategy Builder tool to search for industries whose basic operations rely strongly on commodity demand.

We can see that, despite the recent attention, Bunge’s headline exposure to China is relatively low when compared to companies dealing in mineral commodities like Glencore PLC ADR GLNCY, POSCO PKX and United States Steel Corp. X.

While traders and investors are relieved by the deadline extension, it’s important to keep in mind that, although new tariffs aren’t as close on the horizon as they once appeared, there are still hundreds of billions of dollars worth of goods being taxed by either country. Until real progress is made, or until a true resolution is reached, companies across the board will likely feel the pressure of the global trade war.

Yewno is a content partner of Benzinga.