NEW YORK: BlackRock Inc, the world's largest asset manager, reported first-quarter profit that exceeded expectations and raked in $65 billion of new investor cash as global financial markets rebounded from a volatile fourth quarter.
Total assets under management grew 3% to $6.52 trillion in the quarter through March 31 from a year earlier, amid a broad-based rebound in global equity markets. Assets had dipped below $6 trillion amid market turmoil late last year.
Total quarterly net inflows across all product types jumped 13.6 percent to $64.67 billion from a year earlier.
Overall, the company sold $59 billion in stock, bond and other "long-term" investment funds, up from the $43.6 billion in the quarter ended Dec. 31.
BlackRock shares were up 2.2% at $461.56 in early trading.
The U.S. economy is speeding up again after a slowdown and the market is getting ready for "huge" inflows into stocks, BlackRock Inc's Chief Executive Larry Fink told Reuters in an interview on Tuesday.
"I believe people are still under-risked, despite the big rebound," Fink said.
The benchmark S&P 500 stock index, which sank 14 percent in the final three months of 2018, rebounded by 13 percent in the first quarter, its best performance since the third quarter of 2009.
BlackRock lost more than $26 billion in its equity portfolio during the first quarter, but this was more than offset by a jump in fixed income of nearly $80 billion. Long-term investments rose by $59 billion.
"Investment flows look stronger than we anticipated," said Kyle Sanders, an analyst with St. Louis-based financial services firm Edward Jones.
"BlackRock has a really strong reputation in fixed income management and it looks like that asset class came back into favor with interest rates kind of dipping lower. I think that drove better-than-expected asset flows," said Sanders.
Institutional fund net inflows grew nearly nine-fold to $29.12 billion from a year ago.
Net income attributable to BlackRock fell to $1.05 billion, or $6.61 per share, in the first quarter, from $1.09 billion, or $6.68 per share, a year earlier. That well exceeded analysts' expectations for a profit of $6.13 per share, according to IBES data from Refinitiv.
BlackRock said its iSRead More – Source