BlackRock Investment Institute said it remains overweight U.S. and Japanese stocks, citing support from artificial intelligence, strong corporate earnings and structural reforms.
In its latest weekly commentary, the company writes say The traditional static asset allocation “no longer suffices” in a world shaped by mega forces such as digital disruption, geopolitical fragmentation and demographic divergence, favoring instead a scenario-based approach to portfolio construction.
“We see the AI theme being supported by strong earnings, resilient profit margins and healthy balance sheets at major publicly traded technology companies. Continued Fed easing into 2026 and reduced policy uncertainty underpin our overweight in US equities.”
The company also has an overweight in Japan.
“We like Japanese equities for their strong nominal growth and corporate governance reforms… We are overweight. Strong nominal GDP, healthy business investment and governance reforms – such as the decline in cross-shareholdings – all support equities.”
BlackRock added that it remains selective in Europe and “favors financial services, utilities and healthcare.”
In fixed income, BlackRock said, “we prefer emerging markets for their improved economic resilience and disciplined fiscal and monetary policies.”
The institute reiterated that investors should revisit key portfolio decisions more frequently as long-term economic outcomes become more uncertain.
Overall, the BlackRock Investment Institute showed conviction in US and Japanese stocks while urging investors to take a more dynamic, scenario-based approach as mega forces reshape global markets.
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