U.S. Exceptionalism Is Alive and Well as Nasdaq Outperforms Global Peers

U.S. exceptionalism, the notion that the U.S. economic system and its monetary markets are distinct in comparison with these of different nations, stays alive and effectively, at the very least in keeping with the fairness markets.

Since the early April slide, Wall Street’s tech-heavy Nasdaq index has surged 31%, whereas the broader S&P 500 index has rallied 24%, in keeping with knowledge supply TradingView. Other main indices, such as Germany’s DAX, France’s CAC, Japan’s Nikkei, and China’s Shanghai Composite, have lagged behind Wall Street.

Both Nasdaq and the S&P 500 traded at report highs Thursday. Demand for U.S. Treasury notes has held up amid issues about fiscal sustainability, as famous by CoinDesk final month.

The knowledge contradicts the favored narrative that capital flows are rebalancing away from the U.S. en masse on account of debt jitters and President Donald Trump’s commerce warfare and repeated criticism of the Federal Reserve.

“Several key factors that underpinned U.S. exceptionalism remain fully intact and are perhaps even strengthening further,” Hani Redha, portfolio supervisor, head of technique and analysis for international multi-asset at PineBridge Investments, wrote in a weblog publish revealed final month.

Redha pointed to deregulation underneath Trump as a key issue supporting the US’s productiveness supercycle – distinctive amongst international friends – and its lead globally.

Economy validates U.S. exceptionalism

Other financial variables, such as the true per capita GDP development, additionally help the exceptionalism narrative. The metric measures the speed at which the worth of products and providers produced per individual in an economic system is adjusted for inflation.

“The U.S. massively outperforms the EU in terms of real per capita GDP growth. The reasons for that are deeply structural and haven’t changed one bit. U.S. exceptionalism – for growth at least – is here to stay…,” Robin Brooks, senior fellow within the Global Economy and Development program on the Brookings Institution, stated on X.

The U.S. jobs knowledge launched Thursday additional added one other stake within the ‘loss of American exceptionalism narrative, as Bruce J Clark, head of rates at Informa Global Markets, said on LinkedIn.

Implications for BTC and DXY

The return of U.S. exceptionalism to U.S. stocks can be viewed as a positive development for bitcoin

and the broader crypto market, given the historical positive correlation between the two.

BTC, the leading cryptocurrency by market value, has already risen 44% to $108,000, rallying swiftly from the early April lows of nearly $75,000, according to CoinDesk data. Moreover, with the pro-crypto president in the White House, one may argue that bitcoin is part of the U.S. exceptionalism play.

Meanwhile, the return of U.S. exceptionalism could also put a floor under the U.S. dollar. “With today’s jobs knowledge placing one other stake within the ‘loss of American exceptionalism’ narrative, the temptation to get lengthy {dollars} right here for a counter-trend commerce is massive and rising,” Clark famous, including the ECB officers’ rising discomfort with the robust euro.

Early this week, the FT reported, quoting a senior ECB official, that the central financial institution might have to sign that an excessive amount of strengthening within the euro might be a problem, as it would lead inflation to hover beneath targets. Meanwhile, in an interview with Bloomberg, ECB Vice President Luis de Guindos stated that “overshooting” of the euro must be prevented, flagging ranges above 1.20 as sophisticated.