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Pro Analysis

Goldman: China, not Fed, to dictate market's move

A bank teller counting stacks of Chinese currency notes at a local bank in the eastern city of Nanjing.
AFP | Getty Images
A bank teller counting stacks of Chinese currency notes at a local bank in the eastern city of Nanjing.

Investors should stop trying to guess when the Federal Reserve will raise interest rates and instead focus on the Chinese renminbi, Goldman Sachs told clients over the weekend.

"We believe fund managers should look past the great rate debate and pay attention to the strengthening U.S. dollar relative to the China RMB," wrote David Kostin, Goldman's chief U.S. equity strategist.

"The S&P 500 has typically fallen sharply when U.S. dollar/China renminbi fixing has moved higher," he added.

But the firm named stocks that could beat the market in this scenario.