Goldman Sachs: Hedge funds rapidly sold industrial stocks last week and bought energy stocks for the fourth consecutive week
Goldman Sachs report shows that hedge funds accelerated selling industrial stocks last week, while buying energy stocks for the fourth consecutive week, especially in oil, natural gas, and related equipment. Although there was some buying interest in air transport and defense stocks, the main focus was on providing professional services, ground transportation, and passenger aviation. Investors are betting on the Fed rate cut and Trump's return to the White House being favorable for the energy sector, driving these funds to shift towards the energy sector
According to the financial news app Zhitong Finance, a report from Goldman Sachs shows that hedge funds sold industrial stocks at the fastest pace since December last week, while buying energy stocks for the fourth consecutive week. The report points out that although there was some buying interest in air transport and defense stocks, hedge funds sold stocks of companies providing professional services, ground transportation, machinery, and passenger airlines.
The shift of hedge funds from industrial stocks to energy stocks indicates their bets on which economic sectors may thrive due to the anticipated interest rate cuts by the Federal Reserve. Paul O'Neill, Chief Investment Officer of wealth management firm Bentley Reid, stated, "If the Federal Reserve manages to achieve a soft landing, global economic growth will be better than expected, which may be the reason for these hedge funds' change in attitude."
Meanwhile, hedge funds continue to buy stocks of oil and gas companies. The report states that energy stocks were the most net bought stocks in Goldman Sachs' US institutional brokerage business, with hedge funds buying stocks of oil, natural gas, consumable fuels, and energy equipment and supplies for the fourth consecutive week. The report also mentions that hedge funds currently hold the highest proportion of energy stocks since the beginning of this year.
Some analysts believe that these bets also reflect the so-called "Trump trade." Some investors have increased their exposure to energy companies, betting on hedge funds that believe energy companies may benefit from relaxed regulatory environment under Trump's return to the White House after the November election