A Bull Market for EAFE

Disclaimer: Your capital is at risk. This is not investment advice.

Issue 49;

The breadth surge continues.
US mega-caps give way to global mid-caps.
Software is now the weakest sector.

In financial markets, money behaves like water, as it will always find somewhere to go and fill the cracks. That describes relative performance - what is working and what is not. The amount of water in the system describes market performance – are stocks rising or falling?

Global Trends is a deep dive into global equities. The aim of this analysis is to better understand which countries, sectors, industries, and stocks are driving market returns. Not only does it help investors identify opportunities, but it also highlights the risks. We try to condense as much important information as possible, focusing on what really matters each week. Embrace this as a weekly discipline, and you’ll soon have a much better understanding of global financial markets.

The World Index retains a ByteTrend Score of 5 and makes another all-time high. The news over the weekend about Greenland and tariffs may have an impact this week.

World Index – Developed Markets – Daily

EAFE versus the USA

EAFE is the acronym for Europe, Australasia, and the Far East. Between 1970 and 1989, EAFE beat US stocks by 3.5x, the main driver being Japan. There was a spell of outperformance in the noughties, but that soon gave up. Since 1970, EAFE has delivered half the returns of US equities. The relative line (purple) has turned up, and a new era is upon us in global stockmarkets.

Market Breadth – Local Currency

Market breadth has improved again. The number of stocks in bullish trends (blue) with ByteTrend Scores of 5 has risen, while the bear trends (red), with ByteTrend scores of 0, have retreated. This is a function of the mega-caps now lagging the market.

Market Breadth – CAPR

Market breadth has improved in CAPR as well. Alpha had been thin due to the mega-cap dominance, but it is now spreading. This is a good time for active managers to show their mettle, as there are more market-beating possibilities.

Surge in Bullish Trends – Local Currency

In local price terms, the market has once again shown high rotation. There is an expanding number of new leading and emerging highs, while weakening and bear trends are also growing in number.

Surge in Bullish Trends - CAPR

In CAPR terms, the number of new market-beating stocks has surged.

Performance by Trend Type

The leading trends are surging, and the emerging trends are picking up too. Weakening and bear trends have slowed.

Regions and Industries Average CAPR Score

Metals & Mining regains the top spot, jumping from a 3.3 to a 3.7. The commodities rally is broadening, led by precious metals, but with copper, aluminium, lithium and others following suit. Oil is the last domino to fall, but so far it has proved remarkably sanguine about geopolitics.

The top four sectors remained the same, but Environmental & Infrastructure rose from 2.5 to 2.8, overtaking Tech Hardware. This is particularly notable in Asia, where it rose from 3.8 to 4.4 – the joint-strongest regional sector alongside EU Banking/Lending. In the Americas, however, it remains incredibly weak. In Asia, there are names like Komatsu (CAPR 5), and there are only 5 of them, all strong. In the Americas, it includes John Deere (1) and Waste Management (1), but also Paccar (5) and Caterpillar (5); a mixed bag.

Automotive and Parts continued to strengthen this week, led by Europe, which is emerging from its auto slump.

Tech Software now occupies the bottom slot, as investors flee the AI trade, despite no change in the fundamentals. Property and REITs rose across all regions, taking the average from 1.2 to 1.4. Falling rates will continue to benefit their recovery. Food & Beverage producers rose from 0.8 to 1.0.

Remember to refer to our GTI: User Guide for an overview of the key concepts and terminology used in this report. These concepts may take a little bit of getting used to, but they are very powerful once you do.

The Value Composite Score (Value) is measured against the company’s own financial history and not in absolute terms. The columns are Cheap (Chp), Value (Val), Fair Value (FV), Overvalued (OV), and Expensive (Exp). The Growth Composite Score (Growth) is measured by sales, earnings cash flow, dividends, and book value on a per share basis. The columns are High, Good, Medium (Med), Low, and Negative (Neg).

Leading Trends with New Highs

These stocks are trading at the 30-week CAPR highs with a ByteTrend Score of 5. All charts shown are CAPR rebased to 100.

Name	360-Day Vol	Mkt Cap $Bn	Value	Growth
Alphabet Inc.	27	3982	OV	Good
Taiwan Semiconductor Manufacturing	22	1427	OV	High
Walmart Inc.	20	954	Exp	Med
Samsung Electronics Co., Ltd.	34	676	Exp	Med
ASML Holding N.V.	40	526	OV	Med
Micron Technology, Inc.	58	408	Exp	Low
SK hynix Inc.	54	354	Exp	High
GE Aerospace	22	343	Exp	High
Caterpillar Inc.	28	303	Exp	Good
Morgan Stanley	19	301	OV	Good
The Goldman Sachs Group, Inc.	20	291	OV	High
HSBC Holdings plc	22	283	OV	High
Lam Research Corporation	43	280	Exp	Good
Novartis AG	20	277	FV	Med
RTX Corporation	24	271	OV	Med
Applied Materials, Inc.	41	261	Exp	Med
Mitsubishi UFJ Financial Group, Inc.	30	215	Exp	High
KLA Corporation	37	206	Exp	Good
Airbus SE	23	199	OV	Good
Amphenol Corporation	26	189	Exp	Good
China Life Insurance Company Limited	34	184	OV	Good
Banco Santander, S.A.	24	180	OV	High
Southern Copper Corporation	38	148	Exp	Low
Analog Devices, Inc.	33	147	OV	Med
Banco Bilbao Vizcaya Argentaria, S.A.	25	139	Exp	High
Sumitomo Mitsui Financial Group, Inc.	27	137	Exp	High
Siemens Energy AG	35	135	Exp	High
Zijin Mining Group Company Limited	39	134	Exp	High
DBS Group Holdings Ltd	16	130	OV	High
Interactive Brokers Group, Inc.	30	127	OV	High
Newmont Corporation	36	125	OV	Neg
Tokyo Electron Limited	54	122	Exp	Good
Fast Retailing Co., Ltd.	34	122	OV	Good
Parker-Hannifin Corporation	21	119	Exp	Good
Investor AB (publ)	15	116	OV	Good
Enel S.p.A.	12	110	OV	High
Mizuho Financial Group, Inc.	30	108	Exp	High
State Bank of India	13	106	OV	High
General Dynamics Corporation	15	99	OV	Med
Agnico Eagle Mines Limited	34	99	OV	High
ITOCHU Corporation	20	94	Exp	Med
Mitsui & Co., Ltd.	23	94	Exp	Med
Delta Electronics, Inc.	39	92	Exp	High
Howmet Aerospace Inc.	24	91	Exp	High
Barclays PLC	25	90	OV	Good
Grupo México, S.A.B. de C.V.	34	86	OV	Neg
The Bank of New York Mellon	16	85	OV	High
ING Groep N.V.	21	84	OV	High
Barrick Gold Corporation	36	83	OV	Good
Corning Incorporated	30	81	Exp	Neg
Lloyds Banking Group plc	23	80	OV	Good
Cummins Inc.	22	80	OV	High
Monster Beverage Corporation	22	76	FV	Good
Western Digital Corporation	54	76	Exp	Neg
ANZ Group Holdings Limited	17	75	FV	Good
Oversea-Chinese Banking	14	71	OV	High
Seagate Technology Holdings	50	70	Exp	Neg
AB Volvo (publ)	28	69	OV	Good
Engie S.A.	17	67	OV	High
Nordea Bank Abp	16	67	FV	High
Mitsubishi Electric Corporation	25	66	Exp	Good
Rocket Companies, Inc.	49	66	Exp	Neg
PACCAR Inc	25	64	OV	High
Manulife Financial Corporation	15	63	OV	Med
Ross Stores, Inc.	19	63	OV	Med
CMOC Group Limited	54	62	OV	High
Wheaton Precious Metals Corp.	32	61	Exp	Low
Suncor Energy Inc.	24	60	FV	High
Hyundai Motor Company	52	58	OV	High
JAPAN POST BANK Co., Ltd.	27	58	OV	Med
Standard Chartered PLC	28	57	OV	High
KBC Group N.V.	18	54	OV	Low
Marubeni Corporation	28	54	Exp	Good
Emirates NBD Bank PJSC	31	52	FV	High
Cameco Corporation	43	51	Exp	High
AngloGold Ashanti Plc	43	49	Exp	High
Ferrovial SE	17	49	OV	High
HeidelbergCement AG	30	48	Exp	Good
Sumitomo Corporation	23	48	OV	High
Antofagasta plc	34	47	Exp	Neg
Rockwell Automation, Inc.	18	47	OV	Med
Hanwha Aerospace Co., Ltd.	60	45	Exp	High
ASSA ABLOY AB (publ)	17	45	FV	Good
China Hongqiao Group Limited	42	45	Exp	Med
Gold Fields Limited	45	45	Exp	Good
Sandvik AB (publ)	18	45	OV	Med
Skandinaviska Enskilda Banken AB	12	43	FV	High
Swedbank AB (publ)	15	42	FV	High
ASE Technology Holding Co., Ltd.	47	42	Exp	Neg
Disco Corporation	52	42	Exp	Good
Doosan Enerbility Co., Ltd.	48	41	Exp	Good
Toyota Tsusho Corporation	26	41	Exp	Good
Saab AB (publ)	49	41	Exp	Good
Kia Corporation	35	40	OV	High

Micron

The shortage in memory chips, combined with the AI hype cycle, has created an astonishing rally in a small group of stocks, of which Micron is the leader. At 10x price-to-sales, it is nearly back to the record it set in August 2000 (12x). However, memory chips are famously cyclical, leading Micron to suffer four 50% crashes in the last decade alone.

Novartis

Swiss healthcare giant Novartis made a large acquisition (Avidity Biosciences) in 2025, worth $12bn. The high price tag made some investors wary, but it strengthens their neuroscience pipeline with late-stage assets, offering a good strategic fit.

Corning

Corning is a leader in materials science with key businesses in optical communications, display technologies, and life sciences. It divested its wireless infrastructure unit in early 2025, allowing it to focus on higher-value areas like AI-driven optical fibre and solar manufacturing.

Suncor Energy

Suncor, a Canadian integrated oil and gas major, boosted shareholder returns late last year, as it boasted good production levels alongside strong capital discipline. This has helped it stay resilient during a low oil price environment, while the brief oil spike in the last fortnight saw it immediately outperform.

SAAB

Swedish SAAB no longer makes cars. It is now a defence/aerospace business, driving Scandinavia’s rearmament. From warships and submarines to remote missile systems, recent orders have been large, driven by domestic supply chain preferences and Trump’s rhetoric and EU defence spending.

New Leading Trends

These stocks are trading at the 30-week CAPR highs with a ByteTrend Score of 5, except they are new trends this week, having previously had a score below 5. All charts shown are CAPR rebased to 100.

Name	360-Day Vol	Mkt Cap $Bn	Value	Growth
Toyota Motor Corporation	25	302	OV	High
Siemens AG	25	237	OV	Good
Safran S.A.	17	155	OV	High
Atlas Copco AB	25	101	FV	Med
Mitsubishi Corporation	18	97	Exp	Good
Northrop Grumman Corporation	23	95	OV	Med
Saudi Arabian Mining Company (Ma'aden)	29	74	OV	High
L3Harris Technologies, Inc.	19	65	OV	Low
Fujitsu Limited	26	51	Exp	Med
Franco-Nevada Corporation	32	47	OV	Good
RWE AG	21	43	OV	High

A Bull Market for EAFE