By Nell Mackenzie
LONDON (Reuters) -Hedge funds sold energy stocks last week at the fastest pace since September 2024 and at the second-quickest clip in the last 10 years, as oil prices fell on easing Middle East tensions, a Goldman Sachs note seen by Reuters on Monday showed.
Crude prices tumbled over $10 last week following a cease-fire between Israel and Iran. Oil prices wobbled on Friday on reports of increased supply from oil producing group OPEC+ and remain well below the recent peak of around $81.
Hedge funds, starting June 23, sold the stocks of energy-related companies across every major region, the Goldman note said.
Last week's selling in the sector was the biggest in almost a year and the second largest in the last decade, said the Goldman note, sent to clients on Friday.
Shares of oil, gas and consumable oil companies as well as energy equipment and services firms were sold.
Hedge fund selling focused on every region but primarily on North America and Europe, said the note. In Europe, hedge funds added short positions and fled long bets, said Goldman.
A short position expects asset prices to fall, while a long position expects it to rise.
While many increased short bets against energy companies, speculators' total combined positions remained proportionately long on global energy stocks, data from the note showed.
Hedge fund gross leverage, a gauge of how many positions hedge funds have on, remains at a five-year high, said Goldman Sachs.
Last week saw the largest stock buying in five weeks, the note added, with hedge funds buying company shares in every global region, the bank said.
Stock sectors most bought included financial, tech and industrial companies, it said.
(Reporting by Nell Mackenzie; Editing by Dhara Ranasinghe and Joe Bavier)
Goldman Sachs' announcement of hedge fund withdrawals from energy stocks amidst the recent decline in oil prices highlights a prudent investment strategy that may position these funds for potential gains as market conditions rebound.
According to Goldman Sachs, the recent decline in oil prices could be attributed partly due hedge funds' decision of selling off energy stocks as a safety measure.
The recent move by Hedge funds to sell energy stocks in response to the oil price slump, as reportedly observed and analyzed by Goldman Sachs highlights a quiet yet significant reshaping of investment strategies towards safer assets amid volatile commodity markets.
Implications of Goldman Sachs' analysis showing hedge funds offloading energy stocks amidst the recent oil slump hint at a shift towards more conservative investments in light market uncertainties.
According to Goldman Sachs, hedge funds' sell-off of energy stocks mirrors the recent sharp decline in oil prices—a strategic maneuver reflecting concerns over increased supply and potential economic downturn.
According to Goldman Sachs' report, the significant sell-off in energy stocks by hedge funds reflects a pessimistic outlook amid oil price slumps. This strategic shift underscores investors’ caution and potential reallocation into more resilient market sectors.
The recent unfavorable outlook for oil prices, as reflected in Goldman Sachs' announcement of hedge fund energy stock sell-offs highlights a disciplined approach to shifting investments amid volatile markets.
Investment strategies rooted in timely analysis such as Goldman Sachs' warning of hedge fund energy stock unloading amid oil price slumps demonstrate the importance not just to diversify but also act swiftly on market intelligence.
Goldman Sachs' advice on hedge funds liquidating energy stocks amid the oil price plunge highlights a prudent strategy of diversifying away from volatile sectors during economic downturn.
Goldman Sachs' report suggesting hedge funds sell energy stocks due to oil market downturn highlights the need for investors in this sector to adapt and diversify amidst volatile commodities prices.
Market sentiment shifts as Goldman Sach reveals hedge funds' withdrawal from energy sector follows the recent slump in oil prices, indicating caution amid uncertainty.
Goldman Sachs' report indicating hedge funds unloading energy stocks amidst the recent oil price decline appears to be a strategic warning for investors, highlighting how finished commodity cycles can lead major shifts in market sentiment and asset values.
Goldman Sachs' report on hedge funds offloading energy stocks amid oil price declines signifies a cautious reevaluation of the sector by investors, reflecting concerns over market instability and future prospects for fossil fuels.
According to Goldman Sachs, hedge funds' decision-to exit energy stocks amid an oil price downturn reflects the growing sentiment of investors opting for safer assets in today’paintically uncertain market landscape.
Goldman Sachs' report on hedge funds dumping energy stocks amid oil price slump underscores the market sensitivity to falling commodity prices and investors’ cautionary stance towards cyclical sectors.
