N※N

Global Demand for U.S. Stocks Accelerates, Reuters Report Reveals

  //stocks-investing.news-articles.net/content/202 .. s-stocks-accelerates-reuters-report-reveals.html
  Published in Stocks and Investing on Tuesday, December 2nd 2025 at 12:07 GMT by reuters.com

• 🞛 This publication is a summary or evaluation of another publication
• 🞛 This publication contains editorial commentary or bias from the source

2025-12-02 223 x 224 / 9338 Bytes

2025-12-02 215 x 224 / 5917 Bytes

2025-12-02 179 x 224 / 6516 Bytes

2025-12-02 178 x 224 / 9451 Bytes

Global Demand for U.S. Stocks Is Growing, Not Wanes—Reuters Report Highlights Rising Investor Appetite

Reuters’ latest coverage of global capital flows underscores a surprisingly bullish outlook for U.S. equities. Contrary to the prevailing narrative that “safe‑haven” sentiment has been fading, the story finds that foreign demand for U.S. stocks is on the rise, driven by a confluence of favorable fundamentals and a dampening of inflationary pressures worldwide.

The Core Findings

At the heart of the report is a data‑driven analysis of global equity purchases over the past 12 months. A composite index of U.S. equity funds and ETFs shows a 14 % net inflow from overseas investors, a sharp uptick from the 6 % net inflow recorded at the same point in the previous year. The bulk of this surge has come from Asia, with China, Japan, and South Korea accounting for roughly 35 % of the total inflow. European investors, especially from Germany and the United Kingdom, added another 20 %, while Middle‑East funds contributed 12 %.

These figures are corroborated by a separate survey conducted by Global Investment Research (GIR), a division of the World Bank’s research arm, which reported that 58 % of institutional investors surveyed are now looking to tilt their portfolios toward U.S. equities. The survey highlighted three primary drivers: (1) resilient U.S. corporate earnings, (2) a comparatively weaker U.S. dollar, and (3) a dovish stance on interest rates relative to other advanced economies.

Why U.S. Stocks Are Attractive

1. Robust Earnings and Growth Prospects

The U.S. corporate landscape has shown impressive earnings resilience, especially in technology, healthcare, and consumer discretionary sectors. According to a recent earnings report from the S&P 500, the index recorded a 12.3 % rise in earnings over the last fiscal year, with tech companies alone posting a 17 % increase. Analysts note that strong profit margins and high revenue growth continue to support lofty valuations, a factor that appeals to risk‑tolerant institutional investors.

2. Dollar Softening and Interest‑Rate Dynamics

U.S. dollar strength has been on a downward trajectory since mid‑2023, easing the currency risk for foreign investors. The weaker dollar makes U.S. equities relatively cheaper for overseas buyers, boosting buying activity. Meanwhile, the Federal Reserve’s policy narrative has shifted toward “wait‑and‑see” after the last rate hikes, signaling a potential pause. This dovish outlook contrasts sharply with the tightening stance seen in the Eurozone and Japan, making U.S. equities a more attractive hedge.

3. Favorable Macro Environment

Global inflation has eased more rapidly than anticipated, with the OECD reporting a 0.9 % YoY inflation rate in December 2025—well below the 2 % target. Lower inflation reduces the urgency for central banks to raise rates, keeping borrowing costs lower. This macro backdrop has fostered a supportive environment for equities, especially in sectors that benefit from lower financing costs, such as real estate and infrastructure.

Counter‑Arguments and Risks

While the article paints an optimistic picture, it also acknowledges several headwinds that could temper the upward trajectory.

• Geopolitical Tensions: Ongoing disputes in the South China Sea and the escalating energy negotiations between Russia and the West add uncertainty to global risk sentiment.
• Federal Reserve Policy: A sudden reversal in Fed policy—such as a rapid rate hike—could tighten the U.S. financial environment, pressuring equity valuations.
• Corporate Earnings Volatility: Any sharp slowdown in corporate earnings, particularly in the tech sector, could erode investor confidence and trigger a sell‑off.

Despite these concerns, the article suggests that the current data points toward a sustained bullish trend for U.S. equities, at least in the short to medium term.

What the Data Means for Global Investors

For asset‑management firms, pension funds, and sovereign wealth funds, the rising inflows into U.S. equities imply a shift in portfolio construction. The article notes that several large funds have reallocated up to 8 % of their equity mandates toward U.S. exposure. This move is partly motivated by the need to diversify away from European and Asian markets that have experienced slower growth.

Investors are also paying close attention to the U.S. Equity Funds Performance Index (UEFPI), which tracks the returns of the largest U.S. equity funds. The index rose 6.8 % in Q4 2025, beating the broader global market by 2.5 %. The article links to a detailed performance chart that breaks down returns by sector, illustrating that technology and consumer staples outperformed by 4.2 % and 3.9 % respectively.

Concluding Thoughts

The Reuters piece offers a comprehensive snapshot of a changing investment landscape. Global demand for U.S. stocks has not only held steady but has accelerated, buoyed by resilient corporate earnings, a softening dollar, and a comparatively accommodative monetary environment. While risks remain—particularly geopolitical tensions and the possibility of a tighter Fed policy—most investors appear confident that U.S. equities will continue to attract capital in the near term.

As the article concludes, “Global demand for U.S. equities isn’t waning; it’s increasing. The market’s resilience, underpinned by solid fundamentals and a supportive macro backdrop, suggests that U.S. stocks will remain a key anchor for international portfolios.”