Despite predictions that the US is ‘an empire in decline’, hit remains an attractive place to invest, says Will Mcintosh-Whyte, fund manager on the Rathbone Multi-Assets Portfolio Funds, who gives his outlook on the market.
The term American exceptionalism has grown in prominence over the last year or so, with US tech companies helping to drive US markets higher, resulting in the S&P outperforming the majority of global markets. This reached something of a crescendo after Trump was elected to the White House, and it was no surprise to see a pull back in US markets which with elevated valuations, then ran into the uncertainties of DeepSeek, tariffs and DOGE.
We have had a significant exposure to US markets in the funds for many years, finding many US companies to have very strong management, often with superior margins and better ROIC, as well as finding a wider opportunity set of companies, with certain companies such as hyperscalers or payment networks where there are few comparable peers.
We took the opportunity to add to some of our US companies on the volatility seen earlier this year, believing it to provide an attractive opportunity to add to great companies on a long term view.
There is no doubt that the current tariff uncertainty and fiscal concerns, combined with an administration whose execution of its policy agenda is clumsy at best, has done some damage to the American brand. However, we do not believe this is the end of the US as the dominant global economic super power, and there also remain some potential tailwinds in deregulation, onshoring and tax breaks.
To us the US remains an attractive place to invest and do business, and we continue to find great businesses listed and operating there that we want to own for the long term.
