June 23, 2020 / 9:39 AM / a month ago

Fund giant BlackRock 'warming up' to European assets

FILE PHOTO: A sign for BlackRock Inc hangs above their building in New York U.S., July 16, 2018/File Photo

LONDON (Reuters) - BlackRock’s Investment Institute said on Tuesday it was “warming up” to European assets following what it called the euro zone’s “impressive” efforts to tackle the coronavirus.

The research arm of the world’s biggest fund manager said two factors would support Europe’s economy and financial markets in the coming months.

Success in restricting the spread of COVID-19 and signs that shopping and travel activity was rebounding meant: “we could see the pace of recovery in the second half outpacing other regions, including the United States”.

It said the new 750-billion-euro (£679 billion) European recovery plan was a “crucial turning point” too and will, for the first time, create a jointly issued European ‘safe’ asset of a meaningful size.

“As a result we maintain our overweight in European peripheral government bonds and are considering an upgrade to European equities,” the BII’s top strategists said in a weekly report.

Reporting by Marc Jones; Editing by Saikat Chatterjee

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