BlackRock Fund's Energy Add, Staples Cut Signal Rotation

BlackRock's High Equity Income Fund added to energy holdings and trimmed consumer staples in the first quarter, a rotation that reveals how one of the largest income-focused managers is positioning after a negative quarter.

The fund posted -2.26% for its Institutional shares and -2.31% for Investor A shares during the period, according to its commentary. IT and utilities were the largest contributors to relative performance. Selection in industrials and energy weighed on returns. Consumer staples also detracted.

BlackRock raised its allocation to IT and energy during the quarter. It cut materials and consumer staples.

The moves signal a shift in income strategy. The fund added energy even as the sector dragged on performance. It reduced staples and materials, perhaps anticipating persistent pressure from input costs or demand.

The commentary was current as of March 31.