Foreign Markets Outpace U.S. Stocks in 2026

Investors look overseas as global stocks surge while S&P 500 lags

Feb. 11, 2026 at 5:39am

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The S&P 500 is up just 1.41% year-to-date, while global stocks tracked by the MSCI ACWI ex U.S. ETF have risen nearly 9%. Analysts say investors are looking to hedge currency losses in the U.S. by investing in higher-risk, higher-return markets in Europe and Asia that are seeing stronger performance.

Why it matters

The divergence in performance between U.S. and foreign stocks raises questions about the future of 'American exceptionalism' and whether the dominance of the U.S. dollar is waning as investors seek opportunities overseas.

The details

The S&P 500 futures were up marginally this morning after the index closed down 0.33% yesterday. In contrast, South Korea's KOSPI index is up 24% year-to-date. Analysts say investors are drawn to the faster growth in foreign markets, with some markets seeing gains of nearly 1% per day compared to around 1% per month for the S&P 500.

  • The S&P 500 is up 1.41% year-to-date as of February 11, 2026.
  • The MSCI ACWI ex U.S. ETF, tracking global stocks outside the U.S., is up nearly 9% year-to-date.

The players

Ed Yardeni

Analyst at Yardeni Research who sent clients a chart showing the underperformance of U.S. stocks compared to global markets.

Ruchir Sharma

Chair of Rockefeller International, who noted that foreigners invested a record $1.6 trillion into the U.S. last year.

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What they’re saying

“Does this mean that American exceptionalism, which was touted as recently as 2024, is kaput? Is this another sign of de-dollarization?”

— Ed Yardeni, Analyst

“America remains exceptional, and foreigners continue to invest in the U.S. However, there are plenty of exceptional companies overseas that have also attracted global investors.”

— Ed Yardeni, Analyst

What’s next

Analysts will continue to monitor the performance gap between U.S. and foreign stocks, as well as the impact on the U.S. dollar, to assess the broader implications for the American economy and global financial markets.

The takeaway

The divergence in stock market performance highlights the growing appeal of overseas investment opportunities for global investors, challenging the long-held perception of U.S. financial market dominance and raising questions about the future of American economic exceptionalism.