Global Stocks Outperform U.S. Markets: Key Factors Explained

Global stock markets have recently demonstrated stronger performance compared to U.S. markets. This trend highlights how international equities have outpaced American stocks amid shifting investor sentiments and a surge in AI technologies.

Performance of Global Stocks Versus U.S. Markets

In 2025, the S&P 500 index, which represents 500 of the largest U.S. companies, ended the year with a gain of 16.4 percent. While this is a commendable performance for the U.S. market, it pales in comparison to the gains seen in international markets.

Significant Gains in International Indices

The MSCI World ex USA Index, which tracks over 750 non-U.S. companies, achieved remarkable growth of 28.6 percent during the same year. This disparity can be attributed to various factors influencing investor behavior.

Factors Behind Global Outperformance

• Capital Outflow: Investors have increasingly moved capital away from the U.S. markets. This shift has fueled growth in other regions.
• The AI Boom: The global rush towards artificial intelligence has created substantial investment opportunities outside the U.S.
• Diverse Opportunities: European and Asian markets have presented varied investment opportunities that appealed to investors seeking higher returns.

This combination of factors has led to a pronounced divergence in stock performance internationally versus the U.S., further establishing global equities as a captivating option for investors in the current economic landscape.