Goldman estimates foreign investors were selling U.S. stocks big, but isn’t worried
While Goldman Sachs predicts that foreign investors have dumped more than $60 billion worth of U.S. stocks since March, the firm sees reasons to remain calm. The bank estimated that non-U.S. traders gave up around $41 billion of American stocks on net in March, followed by another $22 billion in April. Fund flow data suggests that European investors drove the selling, while market participants from other international regions remained somewhat positive on U.S. equities. Those numbers can certainly shock investors wondering what’s next for a market that has seen wild trading in the wake of President Donald Trump’s tariff announcement on April 2. But Goldman’s Daniel Chavez has several explanations for why market participants don’t need to fret. First, Chavez said the recent bout of foreign selling was “shorter and shallower” than similar events on average over the last several decades. That’s despite the growing presence of international investors. The Federal Reserve found the group had record participation in the U.S. equity market at the start of 2025. Chavez also pointed out that the current market downturn amid the selling is an outlier. Instead, he said stock prices typically rise even in periods with international investors putting downward pressure on the market. Also, this could be short-lived, he said. The market has been regaining some losses recently as new trade commentary appears “less hawkish,” Chavez said, which makes him believe that selling will happen at a slower clip. To be sure, Chavez warned that the recent political and market volatility may push investors to diversify away from the U.S. However, Chavez said that investors don’t need to worry about a near-term collapse in foreign investor ownership of U.S. stocks. ” Many of the pillars of ‘US exceptionalism’ remain in place, including superior US corporate profitability and long-term earnings growth,” Chavez wrote in a Wednesday note to clients. “In addition, the size and liquidity of other global equity markets relative to the US market limits the potential speed of reallocation away from US equities.” Get Your Ticket to Pro LIVE Join us at the New York Stock Exchange! Uncertain markets? Gain an edge with CNBC Pro LIVE , an exclusive, inaugural event at the historic New York Stock Exchange. In today’s dynamic financial landscape, access to expert insights is paramount. As a CNBC Pro subscriber, we invite you to join us for our first exclusive, in-person CNBC Pro LIVE event at the iconic NYSE on Thursday, June 12. Join interactive Pro clinics led by our Pros Carter Worth, Dan Niles and Dan Ives, with a special edition of Pro Talks with Tom Lee. You’ll also get the opportunity to network with CNBC experts, talent and other Pro subscribers during an exciting cocktail hour on the legendary trading floor. Tickets are limited!
