BlackRock cools on US stocks, turns bullish on short-dated Treasuries

SINGAPORE, Oct 13 (Reuters) – The BlackRock Investment Institute said it had downgraded its view on US stocks to neutral, citing volatility around AI, and upgraded Treasuries, preferring short-term notes.

The move by the research arm of the world’s biggest asset manager is a notable signal of caution on US equities and a vote of confidence in Treasuries as a safe haven.

Here are the details:

• BlackRock Investment Institute closed a “long-held US equity overweight” view, downgrading to “neutral” “to manage potential volatility around the AI buildout”, said Jean Boivin, head of the BlackRock Investment Institute (BII), Rick Reider, BlackRock CIO of fixed income and Wei Li, BlackRock global chief strategist in a note dated October 12.

• BII is unwinding a “US Treasury underweight” view held for most of the last six years, with the researchers turning “overweight” at the short end, where they said rate hike expectations were overdone.

• BII is turning neutral on longer-dated Treasuries and less negative on Japanese government debt, saying the risk-reward calculation for investing has improved.

(Reporting by Tom Westbrook; Editing by Kevin Liffey)

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