International Market Meltdown is another chance for U.S. Stocks to Shine
DENVER, Colo., Apr 07, 2025 (247marketnews.com)- Foreign markets are crumbling, and the reverberations are shaking the world’s financial foundations. Europe’s tanking, Japan’s Nikkei fell, and Asia’s MSCI index outside Japan dropped; a global rout sparked by tariff fears and economic jitters. Yet, amid this chaos, the NYSE and Nasdaq are likely to emerge as the go-to refuge for foreign investors.
While NYSE and Nasdaq were overextended, the S&P 500 is down nearly 10% from its February peak, and the Nasdaq is off over 18% since December. Tech’s “Magnificent Seven” took a 6% hit.
Foreign markets are hemorrhaging; China’s Hang Seng plummeted 12.7%, its worst drop since 2008, as Trump’s 34% tariffs on U.S. goods spark retaliation fears. Japan’s Nikkei shed 9.5% and hit a 52-week low, with banks diving 12% amid tariff panic and yen volatility. Germany’s DAX lost 6.8%, Italy 8.4%, Sweden 7%, and the STOXX 600’s 3.7% drop marks a 16-month bottom.
This brutal selloff may continue a little longer, but a robust U.S. economy, sturdy quarterly reports, job growth roaring back in December, with unemployment at 4.1%, and steady consumer spending, will probably prove to be irresistible and, with most countries tethered to U.S. markets, this flight to safety could turbocharge an American rebound.
Emerging markets are bleeding capital and the U.S. dollar slipped against top currencies this year, but here’s the twist: this isn’t a dollar collapse—it’s a magnet. Foreign investors, burned by sinking Nikkeis and DAXs, see the greenback’s dip as a bargain, not a bust, especially with U.S. GDP humming at 3.1% Q3 2024 and jobless claims dipping.
Most countries crave access to the U.S. market and over 50 pinged the White House for trade talks.
With the U.S. stock market’s $62.2 trillion valuation, which dwarfs Europe, Japan, and China combined, foreign capital has few safe havens in sight and the biggest prize is stateside.
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