BlackRock raised equities from neutral to overweight on a 6-12 month tactical basis, as it sees a powerful restart to the economy due to vaccines, reports BlackRock. BlackRock also downgraded global investments grade debt and U.S. Treasury to underweight.
- From a long-term strategic view, BlackRock remains neutral on stocks due to valuations and a challenging environment for earnings and dividend payouts.
- BlackRock also upgraded emerging market debt to neutral and Asian fixed income to overweight but underweighted Japanese and European equities.
- The company remains focused on stocks of quality companies, particularly in the U.S., that can perform even if financial support is withdrawn.
- BlackRock favors firms with some cyclical exposures, including housing, autos, and materials.
- Trends such as cloud computing, online advertising and digital payments will provide opportunities, and tech sectors like semiconductors and software are also preferable.
- BlackRock expects the U.S. Consumer Price Index (CPI) to get up to the 2.5%-3% range in four or five years and markets to start pricing the outcome next year.
Global Stocks are currently declining. SPY is down 0.22%, DAX is down 0.21%, NI225 is down 0.76%
