Citi Bank has downgraded its recommendation for US stocks to “Neutral” due to rising recession fears, indicating that the US economy may no longer be the primary driver of global growth as it once was. This decision comes at a time when the market is facing increasing pressures, prompting investors to reassess their positions, especially after sharp declines in key US stock indices.
Following the release of the report, US markets suffered significant losses. The Nasdaq dropped by 4%, marking its worst day since 2022, while the S&P 500 fell by 2.7%. These declines highlight growing concerns about the US economy’s performance in the coming months, with expectations that its growth momentum may slow down compared to other global economies.
On the other hand, Citi Bank upgraded its rating for the Chinese market from “Outperform” to “Neutral”, citing positive indicators supporting economic stability. The bank also revised its GDP growth forecast for China this year from 4.5% to 4.7%, reflecting improvements in several economic factors, particularly with increasing government support to boost domestic investments.
One key factor influencing Citi Bank’s revised outlook on China is the attractiveness of the Chinese technology sector, which remains competitively valued compared to global markets. Amid these shifts, analysts recommend that investors closely monitor global economic developments and reassess their investment strategies to align with emerging market trends.
