J.P. Morgan Asset Management predicts that the U.S. stock market will continue to dominate globally in the next decade, mainly due to the advancement of artificial intelligence technology. It is expected that by 2037, the market capitalization share of the U.S. in the global stock market will decrease from 64% to 60%, but will still maintain its lead. Artificial intelligence will enhance corporate efficiency and profit margins, especially as collaborations between large tech companies and other industries accelerate this process. Despite market risks, companies like NVIDIA will continue to have a significant impact on the global market
According to the Zhitong Finance and Economics APP, by scale, American companies have taken the lead in the global stock market. A new chart from Morgan Stanley Asset Management shows that this situation is expected to continue, with the prosperity attributed to artificial intelligence technology. In Morgan Stanley's "2025 Long-Term Capital Market Assumptions" released on Monday, the team predicts that by 2037, the market value share of American companies in the global stock market will decrease from the current 64% to 60%. Nevertheless, the United States will still maintain a huge lead in the world's second-largest stock market.
Monica Issar, Global Head of Multi-Asset and Portfolio Solutions at Morgan Stanley Asset Management, stated at a media roundtable on Monday that as artificial intelligence expands from a few large tech companies that have dominated the market rally over the past year to various industries, the United States will continue to lead the global market in market value share.
Issar gave two reasons for this prediction: increasing revenue and improving profit margins. The first funds will come from artificial intelligence companies outside of large tech companies. As tech companies purchase AI chips from companies like NVIDIA, these AI operators will be forced to collaborate with utility and energy companies.
As artificial intelligence improves business efficiency, eliminates the simplest tasks, and ultimately reduces costs, the profit margins of American companies are expected to increase.
Issar said, "This will demonstrate the dominance of the United States, and then obviously Europe will follow suit, as you start to see some adoption in Europe."
Torsten Sløk, Chief Global Economist at Apollo, wrote in a research report last Thursday that based on the current dominance of the United States, NVIDIA's market value alone exceeds that of most other G7 countries.
Sløk pointed out that it is certain that this could pose a risk to the entire market. Sløk wrote, "Global stock markets, including pension fund portfolios' allocation to stocks, are basically leveraged to NVIDIA stock." "Hopefully, NVIDIA's market value will not drop significantly."
However, others hold a more optimistic view of the dominance of this artificial intelligence superpower. In a recent research report, Nicholas Colas, co-founder of DataTrek Research, detailed why the average annual return of the S&P 500 Index over the next 10 years may exceed 10%. He pointed out that the United States is at the forefront of artificial intelligence applications and leads in the "global application" of this technology.
Colas wrote that in the next decade, the likelihood of a non-U.S. tech company rising and replacing large U.S. tech companies such as Apple, NVIDIA, Microsoft, Amazon, Alphabet, and Meta, which currently dominate the U.S. market share, is "almost zero" Colas wrote: "The United States continues to dominate global venture capital." "If a new American company does threaten the dominance of the giants, it will definitely go public, enter the S&P 500 index, and drive future profit returns."