According to analysts at Goldman Sachs, since the beginning of March, foreign investors have sold American stocks worth $63 billion. Data on high-frequency fund flows show that the sales were initiated by European investors, while other regions continued to buy American stocks.
"This dynamic poses a significant risk to stock valuations, as foreign investors entered 2025 with a record share of ownership of U.S. stocks at 18%," said a note to clients from the portfolio strategy group led by Daniel Chaves.
Since 1980, there have been 10 other instances of significant stock sales by foreign investors. On average, during these sales, 0.6% of the total market value of the U.S. was sold, which is equivalent to about $300 billion today.
Goldman claims that the latest episode of foreign sales was shorter and less intense than the average over the past few decades. In the past, American stocks could withstand outflows of foreign investments, but in 7 out of 10 cases, they rose, with the exceptions of 1987, 1990, and 2022.
