Rest Of World Pulls Ahead

In today's Morning Lineup, we discussed how the US is experiencing near-historic underperformance relative to the rest of the world (ACWX) so far this year. Obviously, there's still a lot of time left, considering February isn't even over yet. However, the US S&P 500 (SPY) is basically unchanged YTD following today's declines, whereas the rest of the world (ACWX) is closing in on a double-digit gain.  Looking at more specific areas, below we show the year-to-date performance of various regional ETFs.  As shown, the S&P 500 has been utterly left in the dust. Meanwhile, Asia excluding Japan (AAXJ) is up 12.6%, Emerging Markets (EEM) are up 12.8%, and Latin America (ILF) is up 20% in under two months.

Those big moves this year—some of which are in the context of larger moves across recent months and years—have also resulted in some interesting technical developments.  For ILF, the past two decades' downtrend is now firmly in the rearview as the ETF approaches early-2018 highs.

As for EM, the past month has seen that ETF reach some of its first all-time highs since 2021.