Alternative Investments: BlackRock Warns on Global Growth

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Weakness in Asia sits at the top of the asset manager’s concerns

Global economic growth sits atop a list of concerns from BlackRock. On Tuesday, the alternative asset manager said it has shifted toward defensive Asian stocks. A report indicates that the company has turned to sectors like telecommunications in China. The group released its projections for next year in a 2020 report on the region.

Among the report’s highlights, the firm said that getting defensive was an “overarching theme” for the asset manager. It projected weaker global economic growth, lackluster returns in 2020, and greater geopolitical uncertainty. It listed the 2020 presidential election, trade worries, and the fact that the market isn’t priced for a selloff as major concerns.

BlackRock and Global Economic Growth

Meanwhile, the asset manager expects that the U.S. dollar will get stronger in the year ahead. However, it also expects slower U.S. growth and a potential flight to safe-haven assets. The company has cut back on Asian countries like Indonesia due to its exposure to U.S. debt. It projected some opportunities in places like Thailand and Taiwan.

The firm also cut its exposure to the Asian financial sector. Finally, it said that this sector has “vulnerabilities [that] would be most evident if the global economy downshifts meaningfully.”

Related: Baker McKenzie: Prepare for a Downturn in M&A

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