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Macro US Stocks

Goldman: Hedge funds dumped tech stocks at fastest pace in two years

Hedge funds sold technology stocks last Thursday at the fastest pace in two years, as Wall Street suffered its biggest selloff since July. In a note to clients, the head of the bank’s hedge fund client business said the move casts serious doubt on conviction in the AI trade, and that beneath the S&P 500’s three-month range, “persistent performance drawdowns” have been masked since late June as the AI trade unwound.

Original source

AI take

The significance here is less the single-day selling speed than what Goldman's own client desk reads into it: that positioning in AI-linked equities may have been momentum rather than conviction. Hedge funds are the audience that matters, since their crowding into the same theme is what turns a rotation into a disorderly exit. The reference to drawdowns masked by index-level range-bound trading suggests the pain has been concentrated beneath the surface for some time. Whether that unwinding broadens beyond tech is the open question.

Generated by AI for reference only.

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