Citi Downgrades U.S. Stocks and Upgrades China on Shifting Economic Prospects

Analysts cite U.S. recession fears and China's AI-driven growth as key factors behind the portfolio shift.

Citi has downgraded its recommendation for U.S. equities from 'overweight' to 'neutral,' marking the first such change since October 2023.
Chinese stocks have been upgraded to 'overweight,' driven by advancements in artificial intelligence, favorable government policies, and attractive valuations.
U.S. markets experienced significant losses, with the Nasdaq 100 dropping nearly 4% and erasing $1.1 trillion in value, the largest single-day loss since 2022.
Analysts predict U.S. economic growth will lag behind other global markets in the coming months, softening the narrative of 'U.S. exceptionalism.'
China's tech sector is seen as undervalued compared to global peers, with potential for further growth tied to AI investments and possible trade policy resolutions.