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9 October 2026

Home / White Papers 2025

Schroders Equity Lens: your go-to guide to global equity markets

by Duncan Lamont, CFA, Head of Strategic Research, Schroders

Summary:

  • US equities’ 25% return over 2024 was the latest in a run of world-beating gains. Their returns have exceeded 20% in five of the past six years, leaving others in their wake. (slides 5-6) (slides 5-15)
  • Stronger earnings growth and rising valuations have powered US returns over the past decade. This has been driven by the Magnificent-7. Outside of them, US earnings growth has been similar to Europe. (slides 7-8)
  • Looking forward…
    • US valuations are very high and profit margins in many sectors are near record levels. It will be hard for either to repeat their contribution of the past decade. (slides 9-10)
    • International equity and US small cap valuations are close to record cheapness vs US large caps. (slide 11). A slightly higher proportion of non-US companies than US ones are forecast to deliver double digit earnings growth in the next 12 months (slide 26)
    • Buybacks have also been on the rise in non-US markets, a marked shift from the past decade. More large UK companies bought back at least 1% of their shares last year than large US ones. (slide 13)
    • 74% of the MSCI World index is now in US stocks and the US market is heavily concentrated in the Magnificent-7. Global portfolios are not well diversified. Investors are unwittingly taking on a lot of stock specific risk. (slides 13-15)

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  •   10 January 2025
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