The trade war took a lot of “sacrifices” with itself. Commodity currencies such as the Canadian dollar and the Australian, to stock indices and violated the trade balances of China and the US – the titans in the collision. Of course, the sectors, resources and industries with the largest mutual exposures have suffered the greatest damage.
However, the resources are a sector that almost nobody paid much attention to. The chart tracks their sensitivity by adding oil, soybeans and the Shanghai Composite Index as an exception, but we see that the index reacts significantly along with zinc. The soybean – of which there was much interest in the Chinese side – is even lagging behind, surprisingly. The least sensitive resources are aluminum, gold and iron ore.
Graphs: Used with permission of Bloomberg Finance L.P.
Trader Martin Nikolov