BlackRock anticipates artificial intelligence will continue to be the dominant influence on US equities in the coming year. The firm’s Investment Institute suggests that AI presents considerable investment opportunities and is fostering a climate conducive to active stock selection strategies. BlackRock believes that AI’s self-reinforcing innovation cycle has the potential to elevate the US above its current 2 per cent growth trajectory, aligning substantial AI infrastructure investments with potential revenue streams.
The investment firm highlights the capital-intensive nature of AI infrastructure development, creating a financing challenge that increases corporate leverage, especially within the technology sector. This build-out phase necessitates strategic financial planning and active management of corporate debt levels to capitalise on the opportunities presented by AI.
Recent US market activity saw stocks increase following the release of PCE inflation data, bolstering expectations that the Federal Reserve will implement rate cuts this week. Concurrently, Treasury yields experienced an upswing. In light of these conditions, BlackRock expresses a preference for US equities, short- and medium-term Treasuries, and a more dynamic investment strategy to leverage the expanding revenue streams generated by AI technologies. BlackRock is a global investment management corporation that provides a range of investment and risk management services. Its goal is to help more and more people experience financial well-being.
