By Carolina Mandl
NEW YORK (Reuters) – Global hedge funds sold U.S. shares of technology, media and telecommunications (TMT) companies at the fastest pace since 2016 in June, driven mainly by semiconductor stocks, Goldman Sachs said in a note.
The selling could indicate that portfolio managers have become more pessimistic about technology stocks, following the sector’s strong rally in the first half of the year. However, no reason is given for this trend.
The bank, which collects its clients’ positioning data, said semiconductors and software were the two top selling sectors in June, while hedge funds increased their allocation to tech hardware and electronic equipment.
Technology stocks were the driving force behind the S&P 500 index’s strong performance in the first half of the year. Artificial intelligence chip maker Nvidia soared 150%, generating 30% of the index’s 15% return.
Goldman Sachs said hedge funds net sold global equities for the third straight month, driven almost entirely by short sellers who borrowed shares to sell on the assumption that prices would fall, allowing them to buy the shares back for less.
“This month’s nominal net sales were the largest since June 2022,” the bank said in the note.
(Reporting by Carolina Mandl in New York; Editing by Richard Chang)
