The S&P 500, tracked by SPDR S&P 500 (NYSE:SPY), has recorded its largest quarterly underperformance against global markets in 37 years.
What Happened: The U.S. benchmark index trailed the MSCI All Country World Excluding United States Index by the widest margin since 1988, according to Bloomberg data shared by Barchart on Monday.
The performance gap marks a notable reversal from recent years when U.S. stocks frequently outpaced international markets.
See Also: April Is Oil’s Best Month, May Second: Will Prices Hit $80 Before Summer?
Why It Matters: Energy emerged as the quarter’s strongest sector, tracking toward its fourth consecutive positive month with year-to-date gains of 8.5%. The Energy Select Sector SPDR Fund (NYSE:XLE) outperformed other sectors in recent trading.
Goldman Sachs, citing the changing market dynamics, lowered its S&P 500 earnings growth estimates to 3% for 2025 and 6% for 2026, down from 7% previously for both years.
Meanwhile, as U.S. stocks struggled, gold prices reached $3,115 per ounce, posting their strongest three-month rally since 2009.
Historical perspective from Bloomberg data indicates the performance gap between U.S. and global stocks has fluctuated significantly over time, with the S&P 500 occasionally outperforming global markets by up to 15 percentage points in the early 1990s, late 1990s, and mid-2000s.
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