BlackRock Reshuffles $185B Portfolios, Backing AI and US Stocks

- BlackRock overweights U.S. equities and AI funds, cutting exposure to international markets. - Strong U.S. earnings growth and anticipated Federal Reserve interest rate cuts prompted the shift. BlackRock increased its allocation to U.S. equities and artificial intelligence (AI) funds within its $185 billion model-portfolio platform. The firm reduced its exposure to international developed markets, creating a 2% overweight position in U.S. equities. This move responds to strong U.S. earnings growth, which reached 11% since the third quarter of 2024. In contrast, earnings growth in other developed markets remained under 2%. Anticipated interest rate cuts from the Federal Reserve also influenced the decision. On September 17, 2025, Cryptopolitan reported that BlackRock’s rebalancing strategy triggered significant capital shifts across its exchange-traded funds (ETFs). Several ETFs saw substantial inflows. The iShares S&P 100 ETF (OEF) gained $3.4 billion, the iShares Core S&P 500 ETF (IVV) added $2.3 billion, and the iShares US Equity Factor Rotation Active ETF (DYNF) attracted nearly $2 billion. The iShares AI Innovation and Tech Active ETF (BAI) also attracted nearly $1.4 billion, reflecting BlackRock’s focus on AI as a high-growth sector. Concurrently, the iShares US Technology ETF (IYW) experienced significant outflows of $2.7 billion as the firm shifted to a more concentrated approach within the AI space. Michael Gates, lead portfolio manager for BlackRock’s Target Allocation ETF model portfolio suite, emphasized the U.S. market’s consistent sales growth and profitability. He cited AI as both a defensive strategy and a growth catalyst. BlackRock’s strategic adjustments underline its confidence in the resilience of U.S. markets and the transformative potential of AI. The capital flows illustrate the growing emphasis on sectors that combine innovation and strong performance in earnings growth.