The key piece of information here is how more and more international diversified ETFs are overtaking the US' S&P 500 $SPY.
International stocks have outperformed YTD versus the United States, a trend that has persistently favored the latter for well over a decade. This has us wondering whether we're entering into a new regime of widening global breadth outside the United States.
Something we're pondering in the short-term, however, is whether we see some rotation back into the United States as many U.S. growth names closed the week bouncing off support while many international ETFs hit their highs.
Take Colombia $GXG, for instance, which is finding resistance at its 2024 highs.
Meanwhile, the Nasdaq 100 $QQQ defended a key level of support.
And while this took place, the relative trend favored the United States over international in a strong way to close last week. Take a look at how much international stocks $VEU underperformed on Friday.
While these are shorter-term trends, the big picture is impossible to ignore.
More international markets are beginning to outperform the US. I think a reasonable argument can be made the setup in the short-term favors US and growth over international.
But if money keeps flowing out of the US and into global stocks, even with this setup, I think there are grounds for a more sustained shift to take place here.
