The U.S. economy is going to take longer to recover from the hit from the coronavirus pandemic than the market expects, and more stimulus is critical, BlackRock Inc (BLK.N) Chief Executive Larry Fink said on Wednesday.
“There is a belief that we will have some form of anti-viral that reduces the severity but let’s be clear, if we had this type of infection rate in March the markets would have been down even further,” Fink said.
U.S. stocks fell sharply during the first three months of the year with the S&P 500 .SPX dipping 20%.
Stocks have recovered since then and the index is down less than 1% for the year, even as coronavirus infections continue to shatter new records in the United States.
“For one reason or another there is less fear about the disease with respect to its impact,” Fink said.
Fink said additional stimulus is critical for the recovery.
“Some jobs are going to have a harder time coming back. There is going to be a need for some kind of stimulus for job creation,” Fink said.
There were 32 million people receiving unemployment checks under all programs in the last week of June, down 433,005 from the prior week, data on Thursday showed. Economists say unemployment remains uncomfortably high because of a second wave of layoffs, which could intensify as COVID-19 infections rise.
The U.S. Senate will begin debate next week on a fifth coronavirus-response bill, Senate Majority Leader Mitch McConnell said on Monday, as he forecast tough negotiations with Democrats, who are seeking broader aid than Republicans.
On Friday, BlackRock Inc’s (BLK.N) results topped Wall Street estimates helped by investors flocking to the world’s largest asset manager’s bond funds.