The global equity boom has gained notable attention, but a significant detail often slips by unnoticed: in the last 18 months, international markets have significantly outpaced the United States.
Since 2025, emerging economies have seen equity markets yield returns of 68%, Europe has experienced 45%, and Japan 44%. In contrast, the U.S. market lagged with returns of only 26%. The planned massive IPOs by companies like Anthropic, SpaceX, and OpenAI are likely to continue affecting the U.S. market’s relative performance.
Despite these developments, the U.S. remains the focal point of the narrative in financial markets, primarily due to its leadership in the global A.I. industry. Many investors still adhere to the belief in American exceptionalism, convinced that the United States is a unique driver of global capitalism with an unchallenged technological lead. Why does this idea persist?
Part of the reason lies in historical precedent. For a long time, foreign markets underperformed the U.S. and were often overlooked. While the U.S. market frequently reached new heights over the years, European equities just recently matched their 2007 levels before the global financial crisis. The Nikkei in Japan surpassed its 1989 bubble peak only in 2024, marking a 35-year journey. Even broad emerging market indexes broke new ground after two decades.
The catch-up of global markets might have been inevitable, but it is not merely a case of catching up. In 2025, corporate profits and earnings saw significant growth across major regions. This surge is largely driven by the ripple effects of the worldwide A.I. infrastructure construction boom. This requires analyzing the flow of investment from U.S. tech companies driving this boom.
Many view A.I. as an American-centric advancement. However, the development of A.I. relies on a globally intricate supply chain. At its center is a notable trio: Nvidia in California for chip designs, ASML in the Netherlands for precision lithography equipment, and TSMC with manufacturing in Taiwan, Japan, China, and America. These three firms overwhelmingly dominate the advanced A.I. chip production landscape.