This has been a recurring theme in this earnings season that major companies sound alarms on the economic slowdown of the world's second largest economy. Apple was the first to break the bad news when it lowered its revenue guidance by 8 percent on Jan. 2, blaming on the weaker demand in China. The country's economic growth in 2018 cooled to its slowest in 28 years amid weakening domestic demand and punishing U.S. tariffs.
And so Goldman has been prepping clients to get ready and avoid stocks with big international exposure.
"Global tensions over trade policy and the economic relationship between U.S. and China will play a key role in the future relative performance of the baskets," Goldman Sachs' chief U.S. equity strategist David Kostin said in a note on Friday. The firm also noted the strong dollar as a risk to multinational companies.
For investors who want to hedge against international risks, Goldman Sachs put together a basket of companies focused on domestic sales.
Verizon, CVS, Charles Schwab and Intuit are among the companies with 100 percent of U.S. sales.
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