Below is a look at the percentage of global stock market capitalization that the US equity market makes up (from Bloomberg). As shown, just recently the United States’ share of world market cap broke out to a six-month high, pushing up to 37.73% as of the close yesterday. That means US equity markets have been outperforming the rest of the world and taking share in the process.
Below is an expanded version of the chart above looking back five years. Back in 2011, US equities made up less than 30% of global market cap. We’ve seen a steady trend higher in US share over the years, but since late 2014, we’ve been stuck in a sideways range with 38% acting as resistance.
Finally, the chart below shows US share of global market cap going back to 2003 (when data begins). Back in 2003, the US made up a much larger piece of the global stock market pie — 45%. And in the years and decades prior to that, it was even higher. From 2003 all the way to the start of the financial crisis, the US lost share as emerging markets like China, India, and Brazil saw their economies grow dramatically and the dollar weakened. It was peak globalization hype, and The World Is Flat was all the rage. Since the financial crisis shook the world, though, we’ve seen the US pick up share slowly and steadily over the years.
Below is a look at the year-to-date performance of 75 country stock markets around the world (in local currency). The main thing you’ll notice is that four G7 countries rank in the bottom ten in terms of stock market performance this year. Canada and the US are the only G7 countries in the black YTD, while Italy is down more than any other country at -22%. Also, two of the four BRIC countries rank in the top five (Russia and Brazil).
Overall, the average year-to-date change of all 75 country stock markets shown is slightly negative at -0.58%. The median YTD change is even weaker at -2.41%, and only 43% of countries are in positive territory. Not a great year for stocks so far, but also could be a lot worse.
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