BlackRock’s Rosenberg says risk assets can handle a Fed rate hike

Wall Street’s biggest asset manager is telling investors to take a breath. Jeffrey Rosenberg, portfolio manager of BlackRock’s Systematic Multi-Strategy Fund, says a 25-basis-point rate hike from the Federal Reserve would not meaningfully threaten risk assets, a view that runs counter to the anxiety currently priced into parts of the market. The argument is straightforward: strong corporate earnings, particularly those driven by artificial intelligence investment, can absorb the pressure that modestly higher borrowing costs create. In Rosenberg’s framing, the structural tailwind from AI is doing more for equity valuations right now than a small rate move could undo. What BlackRock is actually forecasting Rosenberg’s comments are part of BlackRock’s broader mid-2026 investment outlook, which favors US equities as the asset class best positioned to weather a higher-rate environment. The thesis rests on earnings growth outpacing the drag from rising yields, a bet that requires corporate America to keep delivering. On the fixed-income side, BlackRock’s modeling is equally measured. The firm forecasts a 2.5% one-year return for the Bloomberg US Treasury index even in a scenario where th...