Daily Brief - 12 June 2024

BlackRock's growth-stock shift sparks $4 billion ETF surge

BlackRock is boosting its investments in growth stocks, leading to nearly $4 billion flowing into its growth-focused ETFs. This shift, part of a strategy update, drove $2.9 billion into the iShares S&P 500 Growth ETF and $1.4 billion into the iShares MSCI EAFE Growth ETF. The S&P 500 Growth ETF, fuelled by top performer Nvidia, has outpaced the general market this year. Despite this, BlackRock's S&P 500 ETF experienced its largest single-day outflow of $12.9 billion. BlackRock remains optimistic about stocks, seeing a favorable economic environment

Tether plans to pump $1 billion into AI and biotech

Tether plans to invest over $1 billion in deals across AI, infrastructure, and biotech within the next year. The company, famous for its USDT stablecoin, aims to expand its focus beyond cryptocurrency. Tether's CEO Paolo Ardoino said they’re getting hundreds of pitches each month and are especially interested in emerging markets and technology. Tether has already spent $2 billion in these areas over the past two years. The company also continues to hold strong reserves for USDT while exploring new investment opportunities.

Investors worried as private equity funds turn into “Zombies”

A recent survey by Coller Capital shows that many private equity investors fear their money is stuck in “zombie funds.” These funds have little chance of paying out as planned, affecting almost half of the surveyed pension funds and insurers. High interest rates and inflation have made it hard for buyout funds to sell investments or raise new ones. About 64% of investors expect some fund managers to merge or be bought out soon. Many are also uneasy about NAV financing, which adds debt to funds and might hurt future returns.