Foreign investment into the United States reached a historic turning point in 2025, with net purchases of American equities surging 134% to $720.1 billion. This massive influx of capital represents a significant jump from the $307.5 billion recorded in 2024, highlighting a resilient global appetite for U.S. assets despite an era of aggressive trade policy. The surge in buying persisted even as the average tariff rate on U.S. imports climbed from 2.6% to 13% throughout 2025. Market volatility peaked in April 2025 when tariff announcements triggered a $6.6 trillion loss in market value over just two days. However, the S&P 500 ultimately defied these pressures, finishing the year with an 18% total return. As of February 2026, the U.S. Treasury confirms that the momentum of overseas capital continues to challenge the narrative of a shift away from American markets. In 2025, total net purchases of long-term financial assets, including stocks and Treasuries, reached $1.55 trillion—up from $1.18 trillion the previous year. Institutional demand remains high despite the rising cost of trade. The average effective tariff rate hit 9.9% in early 2026, its highest level since 1946. Projections suggest these trade costs could impact average U.S. households by $1,300 this year, potentially squeezing corporate margins as inventories stockpiled in 2025 are depleted. Currently, the S&P 500 is trading near 6,880, maintaining a steady path after the significant gains of the past year. While some sectors face headwinds from trade restrictions, AI infrastructure and regional banking have emerged as preferred havens for capital. Foreign investors now hold a dominant position in the domestic landscape, with private foreign inflows contributing $32.7 billion in December 2025 alone. This suggests that global participants are prioritizing U.S. earnings growth and the relative stability of the American economy over the risks associated with ongoing trade tensions. The market outlook for 2026 remains cautiously optimistic. Analysts project a potential 12% to 14% total return for the S&P 500, supported by an expected 14% growth in corporate earnings. Even with the highest tariff environment in decades, the "Sell America" theory has failed to materialize as trillions in foreign capital continue to flow into the U.S. financial system.