ECONOMIC PULSE
Why Global Capital Flows Are Favoring U.S. Stocks?
Economic resilience, tech leadership & post-election confidence are driving investor confidence in U.S. markets, leaving Europe and Emerging Markets behind
The so-called ‘Trump Trade’ has been in full swing since the recent Republican win in the U.S. elections. Capital inflows into the U.S. markets show no signs of slowing down going into the holiday season. Stock investors have been the biggest beneficiaries, with the benchmark index S&P 500 climbing 4.3% since the election as enthusiasm grows around the president-elect’s proposals for tax cuts and deregulation.
U.S. equity markets are significantly outpacing their global peers in both year-to-date (YTD) and recent inflows, underscoring investor confidence in the American economy. According to EPFR data compiled by Barclays (chart below), the U.S. saw an impressive $404.7 billion in YTD equity inflows, far outstripping other regions. In the past month alone, U.S. equities garnered $109.4 billion, signaling sustained optimism following recent U.S. elections.
Europe and the UK, in contrast, are facing steep outflows. Europe saw YTD outflows of $52.5 billion, with a 1-month decline of $9.9 billion. The UK…
