BlackRock resumes buying US stocks: fund does not expect global crisis due to war

Investment giant BlackRock, which manages assets worth $14 trillion, on April 13 returned the investment rating "above market" (Overweight, corresponds to the recommendation to buy) to U.S. stocks, Bloomberg noted. Strategists of the world's largest investment fund concluded that the damage to the global economy from the conflict in the Middle East "will be limited".

BlackRock noted that after downgrading U.S. equities to Neutral (Neutral, a recommendation not to sell but not to buy an asset either) in March because of the war in Iran, the fund has come to expect "two benchmarks to build risk": moves to resume shipping through the Strait of Hormuz and signs of a moderate negative impact of the Iranian crisis on global growth. "We are [now] seeing developments on both fronts," analysts led by BlackRock Investment Institute head Jean Boivin wrote, calling the two-week truce "important" and the threshold for a return to hostilities "high."

In the U.S. equities segment, "limited damage to global growth from the Middle East conflict and strong earnings expectations - especially in the technology sector - maintain our risk appetite," BlackRock emphasized. The fund's strategists pointed to a "projected 80 percent jump in earnings for semiconductor stocks this year." In addition, the development of artificial intelligence and the geopolitical divide, provoking the growth of budget injections into the military-industrial complex and energy independence, "will stimulate demand for infrastructure and electricity," BlackRock added.

"The technology sector is now expected to post earnings growth of 43% in 2026, up from 26% last year. These bright spots partly explain our upgrade in our valuation of U.S. equities," BlackRock said. The investment giant also upgraded its rating on emerging market securities, citing their strong corporate earnings.

U.S. stock rating upgrade from BlackRock was preceded by optimistic assessments from JPMorgan Chase and Morgan Stanley, states Reuters. JPMorgan strategist Mislav Matejka in a note dated April 13 urged investors with a tactical horizon of more than three months to buy out any drawdowns in the stock market. According to Bloomberg Intelligence, after a multi-year trend of lower forecasts by the end of the quarter, Wall Street analysts are now raising corporate earnings forecasts, driven by the performance of oil and semiconductor companies.

Morgan Stanley analyst Michael Wilson called the recent sell-off in U.S. stocks a normal correction rather than the start of a prolonged downturn, pointing to rising corporate earnings and adequate stock price multiples for companies. Morgan Stanley said it continues to favor cyclical sectors like financials, industrials and consumer staples, as well as fundamentally strong growth stocks like AI hyperscalers.

Goldman Sachs economists spoke in a similar vein in March, warning of near-term "correction risks" for global equity markets, but noting that there was little reason for a bear market.

BlackRock's return to a bullish outlook for U.S. stocks coincided with the recovery of the S&P 500: on April 13, the index recouped all losses since the Iranian war began. Last week, United States President Donald Trump went for a two-week truce with the Iranian regime, and on April 13 said that Tehran had requested peace talks despite the blockade of the Strait of Hormuz by the U.S. Navy.

This article was AI-translated and verified by a human editor