Be wary of US stocks as Fed tightening damages economy: BlackRock

Investors should be cautious of US stocks because the market hasn't fully priced in the Federal Reserve's interest rate hikes yet, according to a top BlackRock strategist.

"The earnings outlook and also generally the US equity outlook... does not yet reflect the economic damage that is inflicted upon the US economy and US earnings by the US Federal Reserve's tightening cycle," Petersen said. The central bank began its tightening campaign in March 2022 to combat decades-high inflation, raising rates at nine consecutive meetings.

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