BlackRock Sees Limited Upside for Stocks as Profits Stall and Risks Mount

BlackRock warns U.S. corporate profits have plateaued along with the economy and don't fully reflect the macro damage expected.

BlackRock remains underweight broad equities for the next 6-12 months but is bullish on mega-cap tech, healthcare, and Japanese stocks.

Risks include loss of pricing power as pandemic spending normalizes and tight labor market keeping wages and inflation high.

Stock valuations look elevated given higher bond yields, which offer more attractive income.

Earnings growth expected to pick up this quarter after 3 quarters of flat or declining growth, but outlook cautious.