Schroder lowers stock rating due to valuation risk and US employment data.

Schroder Investment Group has downgraded its rating on global stocks from "positive" to "neutral" due to concerns about overvaluation, overexposure, and volatility in US employment data. "We believe that the risk-return of stocks in the short term is becoming less attractive," said Patrick Brenner, Chief Investment Officer of Multi-Asset. "Although we find it difficult to identify catalysts that could significantly boost the market from here in the short term, we do not believe this marks the end of this market cycle." Given the current high valuations and higher-than-expected risks to US economic growth, Schroder has downgraded its rating on US stocks. In addition, the group has also downgraded its rating on European stocks outside of the UK, as tariff risks and a stronger euro are seen as offsetting the economic rebound in Europe.