‘De-dollarization’ is dead: Investors discount Trump’s dramas as they pile into U.S. assets

There is a conflict between Wall Street analysts right now over the right strategy for dealing with U.S. dollar-denominated assets. Some, like Pimco chief investment officer Dan Ivascyn, have recommended investors diversify out of U.S. equities because the Trump administration is so unpredictable. And analysts at ING have been pushing a “sell America” argument for a while now, noting that the 9% decline in the value of the dollar over the last 12 months has imposed a harsh haircut on anyone who bought U.S. assets in that period.

But yesterday we got some data showing that the tide may be turning against the “sell America” crowd.

First, the S&P 500 ticked up 0.26% and futures were up 0.36% this morning. One day’s trading is not significant on its own, of course. But it means that the S&P is up 1.45% year-to-date—a pretty decent pace of growth over such a short stretch.

More significantly, the U.S. government released its most recent numbers for Treasury International Capital Data (covering November), and they revealed that net foreign inflows into U.S. assets of all kinds were $212 billion.

That’s a lot, according to ING’s Chris Turner.

“The main takeaway is that foreigners continue to pour money into U.S. asset markets. The TIC release is a volatile data set, but looking at the rolling 12-month average, in November the net foreign purchase of US assets was around $100 billion per month – compared to around $25 billion in the summer of 2024,” he told clients this morning.

Cathie Wood adjusts her ‘rolling recession’ theory

There are several other factors giving traders good vibes about the U.S.

Ark Invest’s Cathie Wood announced in a new commentary that her “rolling recession” theory (that various sectors of the economy have suffered recessions even though the economy as a whole has held up) may be coming to an end. The U.S. “has evolved into a coiled spring that could bounce back powerfully during the next few years,” she said.

Wood is an idiosyncratic investor, but she has a fervent fanbase buoyed by the performance of her ARK Innovation ETF, which is up 45% over the last 12 months, per Yahoo Finance:

Tech bulls are enthusiastic about Q4 earnings

Her bullishness looks tepid compared to Wedbush’s Dan Ives, who told clients to ignore all the people who have been hating on tech stocks recently.

“We believe tech stocks will have a very strong 4Q earnings season led by Big Tech as the cloud stalwarts Microsoft, Alphabet, and Amazon had very robust AI enterprise demand in the quarter based on our field checks,” he said. “We believe … the Street is still underestimating how big this AI spending trajectory is and we expect 4Q tech earnings to be another validation moment with a doubling down on aggressive initial capex numbers into 2026. Our bullish view is that investors are still not fully appreciating the tidal wave of growth on the horizon from the $3 trillion of spending over the next three years coming from enterprise and government.”

There’s a price gauge showing he may be right: The price of copper is up 33% over the last 12 months (based on the Comex continuous contract). President Trump’s copper tariffs didn’t help, of course, but the underlying issue is that tech companies building AI data centers need as much copper as they can get—so the copper price looks like an indicator of robust tech activity.

Trump: much smoke, less fire

Lastly, investors are becoming inured to Trump’s political dramas as they learn that much smoke often means little fire. Trump may have apprehended Venezuelan dictator Nicolás Maduro, but he left the remainder of his regime in place. He may have threatened to bomb Iran again, but then he didn’t. His administration may be criminally investigating U.S. Federal Reserve Chairman Jerome Powell, but after Powell came out against him with guns blazing in a video on Sunday, Wall Street was reassured that Fed independence wasn’t going away in the short term. Even Trump’s threat to invade Greenland looks like it might end up in the Pentagon’s “easier said than done” file.

‘De-dollarization is going to take some time’

ING’s Turner isn’t giving up on his theory that the world is slowly moving away from the dollar. His note this morning admitted that the greenback isn’t dead yet. The dollar has gained nearly a full percentage point in value on the DXY index of foreign currencies since the start of the year.

“The dollar is drifting higher this week on probably what is best described as a macro move. U.S. data has come in on the firmer side, e.g. retail sales and jobless claims, while the Fed’s Beige Book presented a view of a gently expanding economy and no immediate threat to the jobs market,” he told clients.

“We would again conclude that de-dollarization is going to take some time and that if the dollar is to come lower this year, it will be driven by lower U.S. [interest] rates and increased foreign hedging of U.S. assets.”

Here’s a snapshot of the markets ahead of the opening bell in New York this morning:

• S&P 500 futures were up 0.36% this morning. The last session closed up 0.26%.
• STOXX Europe 600 was flat in early trading.
• The U.K.’s FTSE 100 was flat in early trading. 
• Japan’s Nikkei 225 was down 0.32%.
• China’s CSI 300 was down 0.41%. 
• The South Korea KOSPI was up 0.9%. 
• India’s NIFTY 50 was up 0.16%. 
• Bitcoin was down to $95.5K.

This story was originally featured on Fortune.com