Don't ditch stocks yet, BlackRock CEO says

Larry Fink remains bullish on US equities, thinking they'll be higher in 12 months.

By MSN Money Partner Jun 20, 2014 11:27AM
Credit: © woraput/Getty Images
Caption: Market analyze on a digital monitorBy Matthew J. Belvedere, CNBC

There's still upside momentum in stocks and the market should be higher in a year, BlackRock (BLK) Chairman and CEO Larry Fink told CNBC on Thursday.


"The market is more fair-priced here," he said in a "Squawk Box" interview, but added that he would "still be long U.S. equities" because he thinks "they will be higher in 12 months."


BlackRock has more than $4 trillion in assets under management.


Moves by central banks around the world have been putting a floor on stock prices, according to Fink, although he said investors shouldn't expect large gains without an improvement in earnings.


The Federal Reserve should also be a factor in investment decisions, he said.

On Wednesday, the central bank has reduced its bond-buying program by another $10 billion to $35 billion a month. Policymakers also held steady near-zero interest rates, which are expected to stay that way until mid-2015.


The Fed "went from extremely dovish, in my mind, to just dovish," Fink said. "Rates are going to remain low for many years. That's a great foundation to be in higher-yielding fixed-income and . . . equities."


While the Fed did continue to taper its bond-buying, the central bank is actually being more aggressive now relative to the slowing of issuance of bonds due to lower deficits, he said -- calling for the Fed to wind things down more quickly.


Fink said he agrees with Fed Chair Janet Yellen's comments at her news conference Wednesday, playing down recent concerns about inflation. "I don't think there is that much inflation within the economy."


That should give Yellen more time to decide on when to start increasing interest rates, he said.


More from CNBC

Tags: BLK
9Comments
Jun 20, 2014 12:17PM
avatar
We may get a 5-10% correction because of some black swan created by politicians or unrest,  However, if the Fed's remarks about 1% by EOY 2015 and 2% by EOY 2016 are correct  then stocks yielding 3-6% are a no brainer. A 5-10% correction could increase that yield to 8-16% on a rebound which destroys the 2-4% available in bonds.
Jun 23, 2014 10:16AM
avatar

S&P trailing P/E is around 19.5; long term average is around 15. Duh.


Future earnings won't be much better and there are lots of headwinds; wars, rumors of wars, two contentious elections next two years and a irate consumer who no longer believes politicians or money managers.

If ever there was a time for sensible asset allocation, it is now. No inflation, my posterior.

Jun 23, 2014 4:48AM
avatar
Newsflash for those Naive about Global Markets, it matters not whether a given person is a Stock Broker or so Called Money Manager, the vast Majority of them will still state the Markets will be higher in 12 months. The vast Majority of them cannot out perform the general indexes. Basically a Monkey throwing darts at a Board full of Stocks can beat then on a yearly basis in picking stock winners.

Folks like Fink don't ever want to be in a position where they have to liquidate holdings to deal with massive outflows from their Assets of Management. He is basically trying to protect his own interest, he could care less about the actual Market risks to others be that today or years from now.

He knows full well what will happen in a Major Market Reversal. He and others will Milk this Cow for all it's worth. The 3 Major Global Central Banks are doing everything in their Power to keep the Milk flowing.

However, when it's all comes unraveling and it will, they will claim nobody saw it coming when almost everyone including them saw it coming. They are the foundation for it's future failure. It will be Epic, unprecedented, and the worst part, it will last for a very, very long time. From the Mother of all Bull Markets to the Mother of all Bear Markets. So everyone, enjoy the Ride while it lasts.
Jun 20, 2014 12:09PM
avatar
"Fink said. "Rates are going to remain low for many years. That's a great foundation to be in higher-yielding fixed-income and . . . equities." ........the central bank is actually being more aggressive now relative to the slowing of issuance of bonds due to lower deficits, he said"

What? Rates aren't going to stay at a given level just because it suits your needs. Eventually Market forces do come into play. These Folks claim to believe in the Dynamics of Free Markets, at least that's the BS they claim daily. Lower deficits, that's not going to last for long. Our Fed can Taper because they have Bloated their Balance sheet to nearly $5Trillion DOLLARS. Brag about taper when the Balance sheet is closer to ZERO. AS of now, the huge Balance sheet is a Big Liability.

Global Debt has Soared 40% since the Great Recession and most of the Countries economies that received Bailouts have shrunk, not grown. Plus most have much higher unemployment. All this Pie in the Sky  Talk, That just avoids the Adult Conversation about what's really happening across the Globe. And that's the whole point of it, right.
Jun 20, 2014 12:00PM
avatar

"Fink said he agrees with Fed Chair 's comments at her news conference Wednesday, playing down recent concerns about inflation. "I don't think there is that much inflation within the economy."


This statement is trying to insult the intelligence of the average Joe/Sue. In the REAL World, most folks know that Inflation is Rampant and broadly felt by most consumers. Have you ever noticed how the SuperRich nor the Government have NEVER understood the concept of what Inflation truly is?

Jun 20, 2014 11:52AM
avatar
"Larry Fink says he is still bullish on US equities because he thinks they'll be higher in 12 months."

So tell me, when has a so Called Money Manager not stated they are bullish and that stocks will be higher after 12 months. That's like the Cow saying Eat more Chicken. Duh.

Report
Please help us to maintain a healthy and vibrant community by reporting any illegal or inappropriate behavior. If you believe a message violates theCode of Conductplease use this form to notify the moderators. They will investigate your report and take appropriate action. If necessary, they report all illegal activity to the proper authorities.
Categories
100 character limit
Are you sure you want to delete this comment?

DATA PROVIDERS

Copyright © 2014 Microsoft. All rights reserved.

Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.

STOCK SCOUTER

StockScouter rates stocks from 1 to 10, with 10 being the best, using a system of advanced mathematics to determine a stock's expected risk and return. Ratings are displayed on a bell curve, meaning there will be fewer ratings of 1 and 10 and far more of 4 through 7.

114
114 rated 1
278
278 rated 2
474
474 rated 3
641
641 rated 4
639
639 rated 5
663
663 rated 6
640
640 rated 7
499
499 rated 8
284
284 rated 9
122
122 rated 10
12345678910

Top Picks

SYMBOLNAMERATING
COPCONOCOPHILLIPS9
TAT&T Inc9
VZVERIZON COMMUNICATIONS9
KOGKODIAK OIL & GAS Corp9
CVXCHEVRON CORPORATION8
More

VIDEO ON MSN MONEY

ABOUT

Top Stocks provides analysis about the most noteworthy stocks in the market each day, combining some of the best content from around the MSN Money site and the rest of the Web.

Contributors include professional investors and journalists affiliated with MSN Money.

Follow us on Twitter @topstocksmsn.