| | | Blackrock identifies five mega forces that will redefine investments
Jun. 17, 2025 6:19 AM ET
By: Sinchita Mitra, SA News Editor
BlackRock said it still sees five “mega forces” that will define the investment environment and change the inflation outlook, long-term growth and create big shifts in profitability across economies and sectors.
"Looking through the noise, we still see mega forces like AI driving returns, keeping us overweight U.S. stocks," Wei Li, global chief investment strategist at BlackRock Investment Institute, said.
Mega forces are big, structural changes that affect investing now and far in the future, BlackRock said.
The five mega forces that BlackRock identified are:
Demographic Divergence
Li believes that the world is divided between aging advanced economies and younger emerging markets, and both have different implications. The implications could be related to consumption, growth, or labor.
Digital Disruption & Artificial Intelligence
Artificial intelligence has seeped into everyday life and is transforming industries' and companies' growth prospects very quickly. The digital transformation could change how companies compete globally and redefine productivity.
AI's influence on the economy and the markets is quite visible; for example, the launch of China's DeepSeek had rattled U.S. markets.
Tech giants Alphabet ( GOOGL) ( GOOG), Nvidia ( NVDA) and Microsoft ( MSFT) among others, are also investing heavily in AI.
Geopolitical Fragmentation
Li believes that globalization is being rewired, and the world is increasingly being split into competing geographical blocs, which could impact trade.
Future of Finance
A fast-evolving financial architecture is redefining how households and companies transact, or use cash, borrow and seek return. The advent of digital currencies and alternative lending models has changed the architecture.
Net-Zero Transition
BlackRock expects a spur in massive capital reallocation as energy systems are rewired, and the world moves towards a low-carbon economy. |
|
