Quick Summary Earnings beats and upgrades are driving sharp upside gaps Weak guidance and regulatory risk are triggering heavy sell-offs Tech, healthcare and AI-linked names dominate volatility Gapping Up Quince Therapeutics +81.7% Appointed LifeSci Capital to explore strategic alternatives and restructuring Credo Technology +14.5% Issued preliminary Q3 revenue well above guidance Ferrari +10.8% Q4 earnings beat and order book now stretches to end-2027 Entegris +9.5% Beat Q4 results and guided Q1 above consensus Spotify Technology +8.5% Earnings beat , strong premium subscriber growth, and margin improvement Datadog +7.0% Q4 beat and Q1 revenue guidance topped estimates Oscar Health +6.6% Issued strong FY26 revenue and operating earnings outlook Vistra Energy +4.2% Upgraded to Buy by Jefferies Unity Software +3.6% Oppenheimer upgrade to Outperform Astera Labs +3.5% Ahead of earnings and announced new AI design...
Summary
Wall Street investors are increasingly rotating money out of US equities and into global markets, drawn by lower valuations, policy stimulus abroad, and a weaker US dollar. While the US remains a core holding, its dominance is no longer seen as unchallenged.
What’s Driving the Shift
After years of heavy concentration in US mega-cap tech, investors are broadening their horizons as America’s valuation premium narrows.
Key catalysts include:
Fiscal stimulus in Japan
Surging defence and infrastructure spending in Europe
Attractive valuations across emerging markets
A weaker US dollar boosting foreign equity returns
Keith Lerner of Truist summed it up: “It’s no longer just a US story.”
Global Markets Take the Lead
Several international benchmarks have outperformed US indexes in 2026 so far, including:
Stoxx Europe 600
Kospi
MSCI Emerging Markets Index
Japan’s rally gained further momentum after Prime Minister Sanae Takaichi secured a decisive election victory, pushing the Nikkei 225 to a fresh record.
Capital Is Moving — Fast
US$51.6 billion flowed into international equity ETFs in January, per Morningstar
In 2025, the MSCI All-Country World ex-U.S. Index surged 29%, far outpacing the S&P 500 Index at 16%
This marked the index’s best performance in over a decade.
Is This ‘Sell America’ 2.0?
Not quite.
Most fund managers stress this is rebalancing, not abandoning the US:
The US is still viewed as structurally strong
But concentration risk, rising debt, and political uncertainty are prompting diversification
Michael Rosen of Angeles Investments, long overweight US tech, has begun reallocating toward Europe, Japan, and China, calling it a “very big move.”
The Dollar Effect
A key tailwind for global equities:
The US dollar is down ~10% from its 2022 highs
This amplifies foreign equity returns when translated back into dollars
For some investors, last year’s dollar weakness during tariff turbulence was a clear signal of a regime shift.
Bottom Line
The US market isn’t being replaced — but it’s no longer the only game in town.
As valuations stretch and leadership narrows, investors are rediscovering the power of international diversification in what many now see as a global bull market.
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