Photographer: Chris J. Ratcliffe/Bloomberg

US Commerce Secretary Howard Lutnick told the elites gathered in Davos that the Trump administration believes globalization is “a failed policy” that left America behind. A day later, his boss, President Donald Trump, predicted the US stock market would double from records he openly took credit for.

There’s a stark tension lurking between the lines spoken by the two American billionaires: Foreign investors have had an insatiable appetite for US stocks over recent years, playing a huge role in driving benchmark indexes to the records Trump likes to boast about. Europeans, in particular, have been voracious buyers.

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And while Trump lowered the temperature toward Europe, concern lingers on Wall Street that his belligerence and belittlement of the continent could take some of the biggest buyers of US equities out of the market. There are signs, in fact, that’s already beginning to happen.

“We are seeing more clients wanting to diversify away from the US. We saw that trend start in April 2025 but it has somewhat accelerated this week,” said Vincent Mortier, chief investment officer at Amundi SA, which is Europe’s largest asset manager with €2.3 trillion ($2.7 trillion) in assets under management.

He said any disentanglement will end up being a “long and complex process,” where clients need to figure out how they want to depart from main benchmarks, how they want to hedge against the US dollar.

European investors own roughly $10.4 trillion in US stocks — and more than half of that total is owned by investors in the very eight countries Trump threatened with tariffs, a move that contributed to a 2.1% drop in the S&P 500 on Tuesday.

To put those numbers in context, Europeans own 49% of all US stocks held by foreigners — a big enough chunk to pose a threat to the market, Scotiabank portfolio and quantitative strategist Hugo Ste-Marie wrote in note.

“If we see diversification accelerating, it could weigh on US equities, bonds and the dollar over time,” he said.

To be clear, it is highly improbable that Europe would be able to, or even want to, act in concert to ditch US assets. The threat to Wall Street isn’t primarily, if at all, from government actions. But as Trump’s threats and insults persist, money managers from London to Berlin to Madrid have been increasingly fielding inquiries from clients about ways to at least lighten up on US assets.