BlackRock Favors US Equities Over Long-Duration Debt

BlackRock global chief investment strategist Wei Li has expressed a preference for equities over credit and government bonds. The firm maintains an overweight position on US stocks, citing the potential for corporate earnings growth within AI-adjacent sectors.

The firm’s strategy is influenced by expectations for the IT sector, where growth is projected at approximately 44% for 2026. This outlook is detailed in the Fall 2026 Investment Directions report, which suggests that AI infrastructure remains a primary driver for the firm's equity positioning.

Conversely, BlackRock has positioned long-term US Treasuries as underweight. The firm identifies persistent inflation uncertainty and rising term premiums as factors that diminish the appeal of 10-year and 30-year government debt. BlackRock manages approximately $10 trillion in assets and views fiscal pressures as a risk to the profile of long-duration bonds.

Despite the underweight stance on long-term debt, the firm continues to identify income opportunities within fixed income. The strategy focuses on shorter-dated Treasuries, which are utilized for their yields rather than as growth vehicles. This approach aims to manage duration risk while capturing income in an environment where rates have stabilized at elevated levels.