Big investors shift away from US markets

📉 Global Investors Shift Away from U.S. Markets Amid Economic Uncertainty

Institutional investors are increasingly reducing their exposure to U.S. markets, driven by concerns over unpredictable trade policies and rising national debt. This shift has led to a significant underweighting of the U.S. dollar—the most in nearly two decades—and a reallocation of investments toward European markets, such as the UK, France, and Germany.

According to a Bank of America survey, March 2025 saw the largest single-month withdrawal from U.S. equities on record, with fund managers moving from a net 17% overweight in February to a net 23% underweight in March.

European stocks have outperformed their U.S. counterparts this year, with the Stoxx Europe 600 up 9% compared to less than 2% for the S&P 500. Investors are attracted to Europe’s relative political stability and consistent macroeconomic conditions, prompting firms like Caisse de dépôt et placement du Québec and Neuberger Berman to increase their European allocations.

This trend reflects growing investor caution amid concerns about U.S. policy unpredictability and fiscal sustainability.