The world’s largest asset manager is bullish on an economic restart in 2021. BlackRock—with $8 trillion in assets under management globally—earlier this week raised equities from neutral to overweight, largely on its view that the economy will accelerate as COVID-19 vaccines are distributed widely in the coming months.

Along with distribution of the vaccine will come a return of “healthy interaction,” said BlackRock’s Kate Moore on this week’s Walker Webcast. That will lead to a resurgence of service-oriented businesses that have languished during the pandemic.

However, Moore, head of thematic strategy for the global allocation fund at BlackRock, said the economy in recovery may not look quite like the pre-pandemic one. Nor will the recovery necessarily play out as prior rebounds have. “This is anything but a normal recession,” said Moore, tied to a health crisis rather than a financial meltdown.

“Everybody wants to go back to January or February of this year,” Moore told Walker & Dunlop CEO Willy Walker. Yet, over the past nine months, certain segments of the economy have grown, and that growth is not likely to retrench post-pandemic.
“We are at an incredibly exciting time for investing,” said Moore. Such a time is right to look at the future, rather than go back to old playbooks, she added.

Speaking from a broad mandate to assess everything that could shape investment performance for BlackRock’s clients, Moore provided insights on matters ranging from tech-sector stocks to the incoming Biden administration. While predictions about U.S. tax policy still hinge on the outcome of next month’s Senate runoffs in Georgia, which may or may not give Democrats control of both houses of Congress, Moore said she expects the party to take a more centrist approach when actually enacting legislation.

Nor does she expect an abrupt shift from the current administration’s stance on China after the inauguration of Joe Biden. Such a change may occur eventually, but “not on Jan. 21,” said Moore. The incoming president has plenty of other things to deal with first.

Replays of the Jan.9 webcast are available by clicking here and through Walker & Dunlop’s recently launched Driven by Insight podcast series.

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