“Last year, the US was the only game in town, with US exceptionalism prevailing. Every economist was overweight in the US. Then came so-called Liberation Day and that all changed and the war in Iran as well,” Nicholas said at the Summit, which was also attended by WealthBriefing.

Liberation Day – on 2 April 2025 – was when US President Donald Trump announced sweeping tariffs on imports to the US. New tariffs were also announced this year after the US Supreme Court ruled that the Trump administration's use of the International Emergency Economic Powers Act (IEEPA) to impose broad-based tariffs exceeded its statutory authority. Trump reimposed tariffs of 10 per cent under Section 122 of the 1974 Act, with plans to raise them to 15 per cent.

“Expectations changed. Wall Street was looking for 7 per cent earnings growth this time last year in Europe for the next 12 months and this year it’s 11 per cent,” Nicholas continued. “Expectations have improved in Europe. High quality European businesses can be found cheaply today and we are able to buy those. We are significantly underweight in US equities, in favour of Europe. In the US, because of the concentration of US stocks, it’s also a wonderful time to diversify US exposure. We are finding a lot of value in the US even though the US is making new valuation highs.”

Switzerland-based also favours reducing investors allocation to US equities, and increasing exposure in European and emerging market equities in 2026.

Nicholas sees more opportunity in value than growth stocks. “It’s our time to shine,” he said. Harris Oakmark is known for its approach to long-term value investing and US large caps, often accessed via a mutual fund or exchange-traded fund (ETF).

Karen Kharmandarian, CIO, thematic equities at Paris-based  said that recently investors have been actively seeking to diversify away from the US but highlighted that the US market proved its resilience when the Iran conflict started, thanks to its energy sector and the dominant tech sector, which is largely insensitive to oil prices.