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Quarter-End Insights

Industrials: Trade Tensions Lead to Attractive Valuations

Heavy equipment firms and industrial distributors look compelling as the market worries about sanctions and the prospect of a slowing economy.

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The Morningstar Global Industrials Index has dropped 17% quarter to date through Dec. 20 amid concern about trade sanctions (Exhibit 1), underperforming the broader global equity market, which lost 14% over the same interval.

Exhibit 1: Global industrials index fell, underperforming the global equity market

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Keith Schoonmaker does not own shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.