Hedge funds bet against U.S. stocks and turn to Europe, Goldman Sachs says

Hedge funds bet against U.S. stocks and turn to Europe, Goldman Sachs says

LONDON, March 23 (Reuters) – Hedge funds last week piled into bets against U.S. shares and emerging markets stocks in Asia, ​while wagering that European shares would rise, said a ‌Goldman Sachs (GS.N), opens new tab note to clients seen by Reuters on Monday.

Global stocks selling reached new highs last week, the largest net selling since April 2025 ​as speculators shorted equities for the fifth straight week, the ​note from Friday showed.

Global shares slumped for a third week in ​a row (.MIWO00000PUS), opens new tab last week, while bond yields climbed on fears the Iran ​war would keep upward pressure on oil prices and spark inflation.

Index tracking products, like ETFs, as well as single stocks were both net sold, ​said Goldman.

Most global sectors were on balance more sold than ​bought, said Goldman, led by consumer discretionary, tech, and financials.

Consumer staples, which people ‌need ⁠week-to-week, and energy stocks were the only stock sectors where hedge funds held long positions, betting that prices would rise.

Hedge funds ditched long positions and added shorts in emerging markets Asia, ​said the bank.

Hedge ​fund stock ⁠pickers posted a 0.47% rise in performance between March 13 and March 19, many reaping profit from ​their long bets said Goldman.

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Stock pickers have lost ​3.85% so ⁠far in March, but remain up 0.16% for the year to date.

Systematic stock traders made money on short bets and are ⁠up ​just over 6% for the year.

Gross leverage, ​an indication of how much hedge funds are trading, declined to 309.8% for ​the week, it said.

Nell Mackenzie covers hedge funds, their performance and what their trades tell us about financial markets and money flows in the wider economy. She is also a regular guest on Reuters Morning Bid Podcast. She has written in the past for the BBC, Dow Jones, Risk.net, the Times and Business Insider. Nell has also made long-form feature podcasts for Euromoney.