The basis of American exceptionalism in recent years was clear. The US economy grew faster than any other developed market, supported by favourable policies, legal certainty and investor-focused corporate governance. US technology stocks, particularly the so-called Magnificent 7 (Apple, Amazon, Alphabet, Meta, Microsoft, NVIDIA and Tesla), drove much of the equity market returns, with 39% annualised growth between 2015 and 2024, compared to just 12% for the broader S&P 500.
For over a decade, US economic dominance and market leadership were rarely questioned. From GDP growth to equity market outperformance and global capital flows, America’s position at the top of the global financial system was reinforced year after year. But that confidence has started to crack in 2025.
The shift is not sudden, but it is significant. According to Rahul Ghosh, portfolio specialist, global equity at T Rowe Price, “Perhaps it is more appropriate to say that US exceptionalism is transitioning back to normalisation.” He adds that while US leadership in technology and markets remains intact in some respects, investor assumptions built around the idea of US supremacy need to be revisited.
