The Macro Minute with Darius Dale When will global equities stop outperforming US equities?
Feb 18, 2026
Discussion of why global stocks have been beating U.S. equities and the forces behind the rotation. Analysis of European strength tied to rumored leadership change and looming fiscal stimulus. Examination of a dovish Fed under a jobless recovery framework and how AI-driven productivity might reshape labor demand. Conversation about fund manager positioning and risk-management approaches amid uncertainty.
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Cross-Border Rotation Outpacing U.S.
- Global equities have been outperforming U.S. stocks since late November as risk appetite recalibrates away from mega-cap AI winners.
- Europe and Japan led with materially stronger returns while the S&P 500 and NASDAQ lagged over the same period.
Rotate From Mega-Cap Concentration
- Rotate portfolios away from concentrated U.S. mega-cap AI exposure into Europe and Japan where breadth is improving.
- Act on cross-border trends rather than waiting for late confirmation of performance divergence.
Europe Gains From Fiscal Momentum
- Renewed European fiscal momentum and ECB leadership speculation are driving inflows into European equities.
- Bank of America shows a sharp jump in manager overweight to Europe, underscoring broad positioning shifts.