BlackRock reduces the stock holdings in model investment portfolios, and holds a cautious view on market excess returns.

As the US stock market soared to record highs after a strong earnings season, BlackRock began trimming its stock holdings in its $220 billion model investment portfolio business. An investment outlook report shows that the world's largest asset management company has reduced its overweight allocation in stocks from 3% to 1%. Data shows that this adjustment led to billions of dollars flowing between BlackRock's various ETFs on Thursday. Michael Gates, the chief portfolio manager of BlackRock's Target Allocation ETF model investment portfolio series, wrote that this move was made after US companies experienced a "seminal earnings season." He stated that strong performance, robust productivity, and a stable economic environment have lifted the S&P 500 index to historic highs in recent weeks, offsetting the negative impact of the escalation of tensions with Iran and the fading expectations of a rate cut by the Federal Reserve this year. However, he also warned that it is increasingly difficult to expect the stock market to continue delivering excess returns, as the market has already priced in the positive factors, and "we believe the path to avoiding potential risks in the future is narrowing." Gates said that BlackRock remains confident in the stock market and will continue to maintain positions betting on corporate profit growth, artificial intelligence, and government spending.