U.S. hedge funds are closing out the year’s first half by selling technology stocks and moving capital into stocks of banks and energy companies.
According to U.S. investment bank Goldman Sachs (GS), hedge funds sold technology stocks in June of this year at the fastest pace on record based on data going back to 2017.
In particular, the so called “smart money” has been offloading shares of high-flying semiconductor and semiconductor-equipment stocks that have been especially strong this year.
In a note to clients, Goldman Sachs said that hedge funds’ exposure to momentum stocks is on pace to decline for the first time in six months during June.
Hedge funds also offloaded consumer stocks in June, including securities related to food, luxury goods, and leisure/travel.
At the same time, hedge funds have become net buyers of financial and energy stocks, notably banks and oil producers.
Hedge fund positions in bank stocks are now at their highest level since 2022, said Goldman.
However, the most buying among hedge funds in June occurred in the energy sector as the price of crude oil climbed throughout the month.
Goldman Sachs noted that the selling of technology stocks among hedge funds in recent weeks has coincided with market volatility in the sector.
