tl;dr
BlackRock's Ben Powell advises investors to diversify beyond US markets due to risks from a weakening dollar and trade tensions. He highlights emerging markets like India for their strong labor growth, technological advances, geopolitical importance, and favorable demographics. Powell notes India's ...
BlackRock advises investors to diversify beyond US markets due to risks arising from a weakening dollar and escalating trade tensions.
Emerging markets, particularly India, are favored for their strong labor growth, technological advancements, and geopolitical significance.
India's economy is expanding rapidly and is poised to surpass Japan’s GDP in the near future, propelled by significant technological productivity gains.
Despite these risks and the opportunities abroad, BlackRock maintains an overweight position in US equities, citing artificial intelligence (AI) as a potential powerful driver for US market growth.
Ben Powell, BlackRock’s chief of Middle East & APAC at the Investment Institute, emphasizes the importance of not concentrating investments solely in the US, warning that "having all your eggs in one basket, even a beautiful basket like the US, feels a bit riskier."
He highlights India's rising geopolitical influence and demographic trends as key factors supporting diversification.
Powell points out that India is currently neck and neck with Japan economically and may soon overtake it, underscoring foreigners' underestimation of India’s technological productivity improvements.
Nevertheless, BlackRock remains bullish on US equities, acknowledging AI as a “megaforce” that could offset market concerns and drive further gains.