Investing.com - BlackRock, the world's largest asset manager, sees higher stock prices in the months ahead but with more "muted returns" and higher volatility.In its second-quarter outlook, BlackRock says it still likes equities over bonds, and prefers the U.S. and emerging markets over other regions. Technology and financials are its favorite sectors. The firm believes the Trump administration's massive tax cut and other fiscal stimulus have "supercharged growth and earnings estimates." BlackRock sees two major risks to the global economy and markets: trade wars and a jump in bond yields.The firm says U.S. protectionism may trigger bouts of market volatility but is unlikely to derail the "benign economic and market backdrop."Similarly, bond yields won't be a problem as long as their rise is steady and driven by improving growth, as opposed to a spike because of an inflation scare.