Citi Maintains 'Overweight' Rating on US Stocks, Optimistic About Tech and Healthcare Sectors

On May 11, Citi Group strategists stated that the US stock market, driven by a few large tech stocks, is expected to continue outperforming. The team led by Beata Manthey maintains an 'overweight' position on US equities in global asset allocation, while favoring the technology, healthcare, and materials sectors at the industry level. In the report, Manthey wrote: 'We expect the trend of concentration within the market to persist, and fundamental factors will re-emerge as dominant amid the spillover effects of uncertainty from the Iran conflict.' Manthey added, 'If progress is made towards a sustained ceasefire between the US and Iran, it could trigger a rebalancing of funds, leading to a rebound in previously underperforming assets.' She also noted that the attractiveness of allocations in the European market is rising. At the industry level, she believes the most attractive areas in Europe (excluding the energy sector) include software, retail, and real estate.