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BlackRock's Fink 'Quite Bullish' on Stocks as Americans Underinvested

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By    |   Friday, 12 January 2018 09:28 AM

BlackRock's Larry Fink tells savvy investors that he's still “quite bullish” on stocks because of robust economic global growth.

The U.S. economy and the global economies "are strong enough to continue the upward bias on equities," Finktold CNBC.

We're "quite bullish," Fink said in a CNBC "Squawk Box" interview.

"We believe the U.S. economy and the global synchronized, global economies are strong enough to continue the upward bias on equities," he said.

He explained that "investors are underinvested," which means he thinks there's more money on the sidelines that could come into the market, CNBC.com explained.

"The demand in credit and other assets is going to keep a spike in interest rates to be more muted," Fink said.

"We think interest rates are going to be higher," he added. "We don't think this is necessarily bad."

Meanwhile, corporate results for 2017’s final quarter will start pouring in next week and are expected to be laden with one-time charges as U.S. companies begin to cope with tax code changes, including a one-time tax on trillions of dollars in profits held overseas, Reuters said.

Wall Street investors will be tuned in to chief executives’ statements about plans for 2018 and beyond for savings that will result from a deep cut in corporate income taxes enacted last month by the U.S. Congress and President Donald Trump.

Some investors expect many companies will use their tax savings to buy back shares and increase dividends, while others will look for increased capital spending or wage increases.

Walmart announced on Thursday that it will raise entry-level wages for hourly employees, partly because of tax cuts. It also said it would lay off thousands of workers and close dozens of Sam’s Club stores.

The tax law was Trump’s first major legislative achievement since he took office in January last year, and it slashes the corporate income tax rate to 21 percent from 35 percent.

The tax package, approved despite the unanimous opposition of Democrats, helped drive stock market gains in the last months of 2017. The momentum has continued in 2018, and there are widespread expectations that investors will overlook fourth-quarter charges and focus on upbeat corporate outlooks.

“What you’ll see is companies will take a one-time hit, but it’s not going to have a bearing on stock price movements,” said David Katz, chief investment officer at Matrix Asset Advisors in New York. “They will talk about 2018, and we feel pretty confident it will be a win to a big win for U.S. companies.”

(Newsmax wire services contributed to this report).

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BlackRock's Larry Fink tells savvy investors that he's still “quite bullish” on stocks because of robust economic global growth.
blackrock, larry fink, stocks, invest
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2018-28-12
Friday, 12 January 2018 09:28 AM
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