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The global stock markets are hanging on the US President‘s every word. The weakening or postponement of new tariffs has recently given the stock markets a tailwind. However, Donald Trump remains unpredictable and the situation is therefore unstable, especially for globally oriented companies. “For investors, the focus is therefore shifting to second-line stocks that are more domestically oriented and benefit from economic stimulus programmes,” says Thorsten Fischer, Managing Director and Head of Portfolio Management at Moventum AM. Among the sectors, financial and technology stocks in particular are currently very promising, regardless of market capitalisation.

US policy remains a key uncertainty factor for the capital markets. As a result, many market participants are acting cautiously and companies are noticeably holding back on investments in real capital (CapEx). At the same time, investors are increasingly withdrawing from the US market, which is reflected in a gradual reduction of the US weighting in many global portfolios. Following the recent price recovery, US equities are already trading significantly above their long-term average again. For example, the S&P 500 is currently trading on a price/earnings ratio (P/E) of around 23.5x, while the ten-year average is around 21x. “This once again raises the question of how sustainable the current valuation premium actually is,” says Fischer. However, in view of the global technology leadership of many US companies and the continuing prospects for tax breaks and regulatory relief, this premium appears justified, at least for the time being.

From a strategic perspective, the focus is therefore shifting to smaller and medium-sized companies. This is because US small caps are more focused on the domestic market and less dependent on global trade flows. They are also interesting from a valuation perspective: the expected earnings growth per share for 2026 is around five per cent higher than that of large caps, which are also more highly valued. “This makes small caps appear to be a sensible addition in order to reduce risks and at the same time better utilise growth potential,” explains Fischer. If investor sentiment generally improves again, the “Mag7” tech stocks (Alphabet, Amazon, Apple, Facebook, Microsoft, Nvidia, Tesla), which came under pressure at the start of the year in particular, are likely to benefit – not least due to their high index weighting and the associated relevance for passive investment vehicles such as exchange-traded funds (ETFs).

By contrast, uncertainty in the USA and major government investment programmes have led to significant capital inflows in Europe. Added to this are interest rate cuts and hopes for an economic upturn in 2026. Investors’ optimism is reflected in valuations: The STOXX Europe 600 is once again trading on a P/E ratio of 16x, compared to a ten-year average of around 17x, although the valuation discount to US equities remains. “The economic bottoming out and the first signs of a cyclical recovery speak in favour of an outperformance of value and second-line stocks,” says Fischer. “To limit export-side risks, a selective focus on domestic market-orientated business models, as in the USA, seems sensible to us.”

From a sector perspective, US financial stocks are currently particularly interesting, as they are the biggest beneficiaries of the US government’s deregulation plans. However, there also appears to be further upside potential in Europe, as “European financial companies are showing pleasing profit trends,” says Fischer. In addition, strong profit growth is continuing in the technology segment, supported by the unbroken megatrend of artificial intelligence (AI), which is additionally fuelling growth potential. “At the same time,” explains Fischer, “we believe a cautious positioning in the healthcare sector makes sense, despite possible spending cuts in the US Medicare programme.” Finally, the infrastructure and construction sector in Central Europe could benefit from government infrastructure projects and the possible reconstruction of Ukraine, with the focus being on construction activities rather than the development or operation of projects.