Foreign investment in US markets

What happened: In 2025, global investors raised approximately $44 billion via IPOs on U.S. exchanges, with foreign investors owning nearly $30 trillion in U.S. stocks and bonds. South Korean investors were the third-largest buyers of U.S. stocks, despite domestic markets hitting record highs. Despite Trump's trade rhetoric, Asian investors continue to seek U.S. exposure. Meanwhile, China is tightening scrutiny on offshore brokerages, making it harder for retail investors to access U.S. stocks.

Market impact: This narrative drives increased capital inflows into U.S. markets, benefiting U.S. equities and bonds. It also boosts U.S. companies' access to global capital. Conversely, it challenges Chinese retail investors' ability to diversify into U.S. markets, potentially shifting capital towards Hong Kong and domestic investments.

What to watch next: In Q2 2026, monitor U.S. IPO activity and foreign investment trends. In Q3 2026, observe the progress of Baldwin and Khanna's bill proposing a federal review board for direct foreign investment in the U.S. Additionally, track Chinese capital flight to U.S. and Hong Kong markets, and any further regulatory changes impacting Chinese retail investors' overseas investments.