Hedge funds sold U.S. stocks at a pace not seen since early January, marking a significant shift in investment behavior after five straight weeks of net buying.
This change in momentum was highlighted in a report from Goldman Sachs prime brokerage, which noted that the sell-off aligns with recent positive signs of economic growth and a firm stance from the Federal Reserve, indicating that interest rates remain high for an extended period can stay. .
According to the report, both macro products, including indexes and ETFs, and individual stocks saw net selling.
Last week marked the first time in six weeks that macro products saw net sales, while individual stocks posted net sales for the third time in a row, recording the highest notional net sales so far this year.
Selling activity was widespread across all 11 U.S. sectors in the week ending May 24, with industrials, information technology, financials, energy, materials and real estate leading the downturn. Cyclical sectors in particular suffered the heaviest notional net turnover since December.
The industrial sector was particularly affected, recording net sales for eleven consecutive sessions. The sector, which includes machinery, ground transportation, professional services and passenger airlines, saw the largest two-week net sales in more than a decade.
