Rich Bank supports US stocks! Warning investors to be overly optimistic about emerging market stocks.

Citibank believes that investors should reduce their holdings in emerging market stocks and instead buy US stocks. The bank's investment strategist Austin Pickle stated in a report that although emerging economies have outperformed the S&P 500 index so far this year, the excess performance of emerging markets is usually related to a weakening US dollar. He predicts that the US dollar will strengthen and warns of the risks that could arise from the tense US-China relationship. Austin Pickle said, "The market sentiment towards emerging markets has become overly optimistic." "We expect a global economic rebound later in 2025, with many trade-related issues eventually being resolved, which will drive up emerging market prices, but their returns will still lag behind those of the US market." Austin Pickle pointed out, "Investors may consider investing in US large-cap stocks, mid-cap stocks, or other developed market stocks." He mentioned that developed economies "have a more stable and predictable regulatory environment, and recent news of increased fiscal spending in Europe may continue to provide positive momentum." The views of Citibank contrast sharply with other Wall Street institutions, such as Morgan Stanley Investment Management, Bank of America, and JPMorgan, which believe that emerging market stocks may finally be turning a corner. Factors such as a weak US dollar and doubts about the safe-haven status of US treasuries are seen as driving factors behind the recovery of emerging market stocks.