A global equity index that excludes U.S. companies has broken above levels last seen before the 2008 financial crisis, marking a key technical breakout and posing a direct challenge to the long-standing American market dominance known as the “U.S. exceptionalism trade.”
Between September 2009 and late 2024, U.S. stocks outperformed global equities by an astonishing 340 percentage points, reinforcing the narrative of American market supremacy. But that narrative is now facing growing skepticism.
Still, May’s rebound in the S&P 500 suggests the U.S. isn’t ready to relinquish its lead just yet.
Global Equities Rally, Led By German Defense Powerhouse
On May 28, the iShares MSCI ACWI ex U.S. ETF (NASDAQ:ACWX) surged to $59.58, its highest price since April 2008. The milestone marks a significant recovery for international equities, which have long trailed their U.S. counterparts.
This market is up 14% year-to-date, beating the SPDR S&P 500 ETF Trust (NYSE:SPY) by roughly 13 percentage points—a record pace of relative outperformance since ACWX’s 2008 inception.
The rally reflects growing investor interest in markets outside the U.S., fueled by concerns over American political risks and debt sustainability.
Yet, in May, the tide shifted slightly. The S&P 500 has gained 6.7% so far this month—on …