BofA strategists predict international stocks will outperform U.S. stocks through the 2020s
International markets currently represent 38% of global stock market vs 62% for U.S.
AI disruption expected to impact U.S. economy more severely than international markets
Emerging markets showing significant fund inflows, potentially signaling early rotation
📖 Full Retelling
Bank of America strategists led by Michael Hartnett predicted in their latest Flow Show report on February 27, 2026, that international stocks will outperform U.S. equities through the second half of the 2020s as a "new world order" emerges after years of American market dominance. The strategists highlighted that international equities currently represent 38% of the $97 trillion global stock market, compared to 62% for U.S. stocks, with this gap expected to narrow over time. Several factors are driving this expected rotation, including fiscal excess policies, rising populism across various regions, and what they term the "end of deflation." Hartnett's team specifically noted that AI disruption could have a more negative impact on the services-heavy U.S. economy and S&P 500 index than on manufacturing and resource-heavy international markets. Recent fund flow data supports the potential shift in market leadership, with global equity funds attracting $38.1 billion in the week ending February 25, while emerging markets led the pack with $15.4 billion in inflows, potentially signaling an early rotation in investment trends.
🏷️ Themes
Global Market Rotation, Economic Shift, Investment Strategy
American multinational banking and financial services corporation
The Bank of America Corporation (Bank of America; often abbreviated BAC or BofA) is an American multinational investment bank and financial services holding company headquartered at the Bank of America Corporate Center in Charlotte, North Carolina, with investment banking and auxiliary headquarters ...
Irish poet, known for work in English and Irish languages
Michael Hartnett (Irish: Mícheál Ó hAirtnéide) (18 September 1941 – 13 October 1999) was an Irish poet who wrote in both English and Irish. He was one of the most significant voices in late 20th-century Irish writing and has been called "Munster's de facto poet laureate".
try{ var _=i o; . if(!_||_&&typeof _==="object"&&_.expiry Netflix soars after declining to match Paramount Skydance bid for Warner Bros Dorsey’s Block slashes workforce 40% to embrace AI overhaul, shares gain Paramount wins Warner bidding war; Block surges - what’s moving markets U.S. stock futures fall; Netflix and PPI data in the spotlight (South Africa Philippines Nigeria) BofA’s Hartnett sees international stocks beating U.S. this decade By Vahid Karaahmetovic Author Vahid Karaahmetovic Stock Markets Published 02/27/2026, 05:19 AM BofA’s Hartnett sees international stocks beating U.S. this decade 0 US500 -0.54% MICNX0000PHK 0.64% MSCIEF -0.57% MIEU00000PUS 0.25% MIWOU0000PUS 0.48% Investing.com -- International equities are poised to outperform U.S. stocks through the second half of the 2020s, according to Bank of America strategists led by Michael Hartnett. Get InvestingPro for a deeper dive into global stock market outlook In the latest Flow Show, the strategists wrote that a “new world order = new world bull,” with international equities expected to gain share after years of U.S. dominance. They highlight that the rest of the world currently represents 38% of the $97 trillion global stock market, versus 62% for the U.S., a gap they expect to narrow over time. Hartnett’s team sees several drivers behind the expected rotation, including fiscal excess, rising populism, and the “end of deflation.” The strategists also argue that AI disruption could weigh more heavily on the U.S. economy and equity market than on overseas peers. “AI disruption more labor market and/or corporate revenue negative to services-heavy U.S. GDP & SPX index than manufacturing/resource-heavy EAFE/EM macro & equity indices,” the team wrote. On flows, BofA said that global equity funds attracted $38.1 billion in the week to Feb. 25, while cash funds drew $38 billion and bond funds took in $16.8 billion. Gold funds saw $6.2 billion of inflows and crypto funds $300 million. Regionally, U.S. eq...
