The markets would see a bullish surge in investor sentiment if the U.S. were to reach a trade deal with the China, BlackRock Chairman and CEO Larry Fink told CNBC on Wednesday.
The deal would need to be substantial enough to reduce tension and include both sides calling off tariffs on each others goods, Fink said. In the latest tariff moves, the U.S. levied 10 percent duties on $200 billion worth of goods from China, prompting Beijing to put tariffs on $60 billion worth of U.S. goods.
“Until we see better certainty on trade and China, we’re not going to see super elevated flows,” said Fink, co-founder of the world’s largest money manager. “If there was a resolution between the U.S. and China, related to trade, we would see a surge in investment sentiment.”
Beijing and Washington are trying to resolve their trade disputes under a tariff cease-fire that ends March 2. President Donald Trump and Chinese President Xi Jinping last month agreed to halt any new levies to give diplomacy a chance.
Fink warned late last year the trade conflict between the U.S. and China could turn into a “full-fledged” trade war if things didn’t change quickly.
Fink appeared on “Squawk Box” shortly after BlackRock reported quarterly earnings that missed expectations and assets under management under $6 trillion. Fourth-quarter revenue slightly beat expectations, according to a revised estimate buy Refinitiv after the earnings report.
In the interview, Fink also said the stock market has made a near-term closing bottom on Christmas Eve. But whether that holds depends on geopolitical risks, he added.
— Editor’s note: This story was updated after Refinitiv revised its projection for BlackRock revenues after the company reported its financial results. According to the revised estimate, BlackRock sales slightly exceeded fourth-quarter expectations.