Forget Trump, the US stock market is already great

There’s no need to start a campaign to make the US stock market great again. It already is great.

This chart, which comes to us from Bank of America Merrill Lynch strategist Michael Hartnett, shows the relative outperformance of the US stock market against the rest of the world.

Over the last couple years, it has been no contest, as the US market has significantly outperformed the rest of the world.

Most of this outperformance, of course, comes from a flat US market doing relatively better than stock markets in the rest of the world that have been declining.

The meaning of the chart, according to Hartnett, is that investors preferring US equities over any other market is a clear representation of a desire for growth and quality in the stock market.

Within the US stock market, for example, utility stocks — which often offer big dividends and operate in regulated markets that typically weather economic downturns well — have been big winners this year as investors look to find quality “safe havens” in a world of super-low bond yields and flattish economic growth.

Extend your view more globally, and you’ll find the US stock market itself serving a similar function.

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