FILE PHOTO: Traders work on the floor of the New York Stock Exchange (NYSE) in New York, U.S., September 20, 2018. REUTERS/Brendan McDermid/File Photo

TOKYO (Reuters) - BlackRock Inc BLK.N President Rob Kapito said on Monday he expects the U.S. stock rally to continue beyond next year, as there are fewer shares available for investors because of increased company buy-backs and dwindling public offerings.

“Recently, given the economic backdrop and tax reform, companies have maintained a lot of cash on their balance sheets. And they have used that cash to buy back their stocks and raise dividends,” Kapito told reporters in Tokyo.

The co-founder of the world’s largest asset manager, with $6.3 trillion in assets under management, added that the drying up of the IPO market is another factor contributing to a shortage of shares.

Fewer shares to buy “drives prices high’, he said.

Asked how long he thinks the rally can last, Kapito told Reuters “Quite a long time - beyond next year. I’m very optimistic.”

Major U.S. stock indices hit record highs in recent weeks are hovering not far from those levels despite worries about trade wars.

(This story corrects figure in third paragraph to $6.3 trillion from $3.6 trillion.)