As US trade news continues to dominate headlines and the market, we'll resume our examination of Chinese and US stocks through the lens of the Exchange Rate Sensitivity factor. This time, we'll be decomposing exposure to this factor in both countries at the sector level, to gain an understanding of what industries are most represented and to see what differences we can identify between the Chinese and US exporter/importer groups. We'll also find the companies in each country that are most exposed to Exchange Rate Sensitivity. 

With all eyes on the US - China trade morass, our focus this week will be on seeing if we can empirically evaluate the impact that ongoing trade friction has had on Chinese stocks. We'll do so through the lens of the Exchange Rate Sensitivity factor in our China-specific model. Ultimately, we'll aim to find out if this factor is an effective way to track trade tensions, and to see how investors have been trading Chinese companies with exposure to it.

Over the past couple of weeks, we've examined Growth and Profitability to see the impact that 1Q earnings have had within the Russell 1000. We've now incorporated two more fundamental factors in our analysis - Value and Earnings Yield - to identify 21 companies that have had positive or negative fundamental changes in the past month that the market hasn't priced in yet. These names may be interesting trade opportunities if they do indeed represent a market imbalance.

Last week, we shared the companies in the Russell 1000 that had seen the biggest changes in exposure to the fundamental factors of Growth and Profitability since the beginning of 1Q earnings season. Today, with more earnings in the rearview, we'll run the same analysis at the Industry Group (GICS 2) level in order to see what more we can learn about the market's response to earnings via these two factors.