American stock indices such as the S&P 500, Dow Jones and Nasdaq have reached new highs in recent months. But in fact, American stocks are lagging behind global stocks - when you remove the US from the global indices.
Philip Jagd, head of equities at Sampension, has looked at how American stocks have performed after a year with Donald Trump as president. When measured in US dollars, American stocks have underperformed by almost 16 percent compared to global stocks excluding the US.
- American stocks have performed significantly worse than the rest of the world. And that is actually unusual when we look back, says Philip Jagd.
According to the equity manager, the performance of US stocks compared to global stocks is the worst since 1994. In addition, it has only happened three times since that US stocks have performed worse than the rest of the world's stocks, when you do it this way.
- In the big picture, the US has outperformed everything and everyone, especially since the financial crisis. So it could well mark a change in the investment climate in the world, says Philip Jagd.
Donald Trump was inaugurated as president on January 20, 2025 after winning the presidential election over then-President Joe Biden. Trump was president for the first time from 2017 to 2021.
According to Philip Jagd, it is not the earnings of US companies that have made investors prioritize other stocks. Earnings are not lagging behind - quite the opposite.
Possible cause of political uncertainty
Instead, the explanation is probably to be found in a combination of lower pricing outside the US and political uncertainty in the US, which has become significantly greater under Trump.
According to Philip Jagd, the risk of having investments in the US has increased in the past year because it has become uncertain what to expect.
He cites the work stoppage at Ørsted's offshore wind farms Revolution Wind and Sunrise Wind as an example of how a single decision from the Trump administration can cost companies dearly from one day to the next.
- When such uncertainty arises, you have to stop and think about whether it is a good idea to have two-thirds of your assets in the US under a man you cannot trust, or whether you should move out a bit, he says.
Philip Jagd also points to The dollar exchange rate is a clear indication that investors have lost confidence in the United States. The US dollar has fallen by around 12 percent against the euro in the past year.
At the same time, both the price of gold and silver has risen to new heights. Investors are particularly drawn to gold and silver during periods of geopolitical unrest and uncertainty.
/ritzau/
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