America’s dominance of the global stock market is unrivaled, and its share has only grown in the past two years.
The outperformance of the S&P 500 has played a role in America’s leading position, averaging 14.8% compound average returns over the past decade. Global equities, represented by the MSCI ACWI (excluding the U.S.) Index, have returned 7% by comparison.
The value of the U.S. stock market is roughly equal to all other regions combined, encompassing 6,062 firms collectively valued at $60.1 trillion. As of February 14, the market capitalization of the Magnificent Seven—Apple, Microsoft, Alphabet, Nvidia, Amazon, and Meta Platforms—was $17.8 trillion, making up almost 30% of the entire U.S. stock market. Last year, these companies fueled more than half of the S&P 500’s returns.
China ranks as the world’s second-largest stock market, valued at $15.6 trillion across 7,061 publicly-traded companies. While Tencent and Alibaba stand as the largest firms by market cap, several financial firms play a dominant role in China’s stock market. With a $5.2 trillion market cap, India’s stock market is now larger than the UK and Latin America combined. In 2024, roughly 20% of households owned shares, rising from just 7% in just five years. Notably, the country’s rapid economic growth and digital transformation have driven shares to rise 80% over the period. By contrast, emerging markets have increased by 6%.
Persistent inflation continued to weigh on consumer confidence, as the Labor Department’s core PCE price index showed prices rising 0.3% in January and 2.6% year-over-year—down from December’s 2.9% but still above the Fed’s 2% target. Despite a 0.9% rise in personal incomes, consumer spending contracted, suggesting caution amid inflation and economic uncertainty. Reflecting this sentiment, The Conference Board’s Consumer Confidence Index fell 7 points to 98.3 in February, the sharpest drop since August 2021, with expectations for income, business, and labor conditions falling below 80, a potential recession signal. Inflation expectations also surged from 5.2% to 6%, adding to economic concerns. Meanwhile, the Commerce Department reported that fourth-quarter GDP grew at an annualized 2.3%, unchanged from prior estimates, with full-year growth at 2.8%, driven by strong consumer spending. However, labor market data showed weakness, as jobless claims for the week ending February 22 rose by 22,000 to 242,000—the highest since October—while the four-week average climbed to 224,000, though continuing jobless claims edged slightly lower to 1.86 million.