4 Domestic Stocks To Shield Your Portfolio From Coronavirus
Zacks Investment Research | Feb 13, 2020 09:54PM ET
The outbreak of Coronavirus, a fast-spreading flu-like illness that shook both corporates and investors alike since its emergence in China last month, continues to hamper investor sentiment. While investors turned their attention to safe-haven assets, such as gold and defensive stocks, one may note that domestic stocks could be an ideal pool to invest in at present.
This is because these stocks have less exposure to the Chinese or global economy and mostly benefit from their operations within the country.
The Epidemic Threatens to Drag Global Economy
As the worldwide sentiment grows bearish because of the virus, investors brood over the impact of the infection on the Chinese and global economy. After all, the Chinese economy today is responsible for 17% of the global GDP and the virus outbreak could take a toll on this Asian country’s growth in the first quarter of 2020.
This is because China is currently a principal component of global trade and services than it was about 20 years ago when the country witnessed the SARS outbreak. Beijing is now the largest trader of merchandise globally and is at the center of key global supply chains, which might get restricted as fears over the Coronavirus outbreak heighten.
According to Evercore ISI Chairman Ed Hyman, China’s GDP growth could be zero in first-quarter 2020 because of the epidemic, a CNBC report Zacks Investment Research
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