Despite market commentary suggesting a pullback from U.S. assets, foreign investment in U.S. stocks and bonds increased in 2025. As Scott Wren notes in Sell America?, a January 28, 2026 Market Commentary from Wells Fargo Investment Institute, data from the U.S. Treasury show that foreign investors purchased a net $1.6 trillion in U.S. securities during the year. That total marked a record high, with nearly half of the inflows directed toward equities.
At the same time, auctions of U.S. Treasury debt continued to see consistent demand from foreign buyers. These inflows coincided with a series of all-time highs across major U.S. equity benchmarks, including the S&P 500 Index and the Dow Jones Industrial Average.
Economic Performance Supported Investor Confidence
According to the report, the relative strength of the U.S. economy played a central role in sustaining foreign investment. The American economy outperformed many developed market peers, supported by resilient consumer spending and historically low unemployment.
Consumer activity accounts for nearly 70% of the U.S. gross domestic product, and spending levels exceeded expectations during the year. In addition, capital expenditures tied to artificial intelligence remained strong. Wells Fargo Investment Institute expects U.S. economic growth of 2.4% for the current year.
In contrast, the commentary notes that China experienced a structural economic slowdown driven by weaker consumer demand. While growth rates in Europe and Japan improved, they remained behind the U.S. pace.
Market Size and Liquidity Differentiated the U.S.
The report also highlights the scale and liquidity of U.S. financial markets as a key factor attracting global capital. The United States maintains the world’s largest market for marketable Treasury and corporate debt. Although the European Union and China rank second and third, their combined markets are smaller than the U.S. market.
According to the commentary, this depth allows U.S. markets to absorb large capital inflows more efficiently. Smaller markets, by comparison, can become overwhelmed more quickly, which may drive valuations to extremes.
Corporate Earnings and Innovation Remained a Draw
Corporate performance continued to support investor interest. The United States remains home to most of the world’s largest capitalization companies, particularly in sectors such as artificial intelligence, biotechnology, and defense.
The S&P 500 Index recorded three consecutive years of record earnings, and the report expects a fourth consecutive year in 2026. The commentary also cites enhanced corporate and consumer tax benefits, along with deregulation, as factors expected to support earnings performance during the year.
Structural Factors Continued to Attract Global Capital
Wells Fargo Investment Institute attributes ongoing foreign investment to several long-standing characteristics of the U.S. market. These include deep and liquid financial markets, corporate innovation, transparency, and the rule of law.
The report emphasizes that forecasts and projections are not guaranteed and remain subject to change. It also reiterates that all asset classes carry risk, including market volatility for equities and interest rate and credit risks for bonds.
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