US technology stocks are facing intense selling pressure from hedge funds.
Hedge funds have sold off information technology positions in six of the past eight weeks, marking the largest eight-week turnover in at least a decade. reports Barchart, citing data from Goldman Sachs.
Technology has been the best-selling US sector among hedge funds in the past week alone.
Hedge funds’ total technology exposure as a percentage of total market exposure has now fallen to the lowest level since February 2026. At the current pace, hedge funds’ technology exposure could reach at least a five-year low as early as next week.
The continued outflows reflect changing risk appetite against the backdrop of high valuations and broader market uncertainties.
Portfolio managers appear to be moving from high-growth sectors to more defensive sectors.
The trend signals increased caution among sophisticated investors regarding near-term technology performance.
Such moves could impact broader market dynamics in the coming weeks.
Goldman Sachs strategists led by Ben Snider say the “painful volatility in popular AI infrastructure stocks” is driving investors to invest in other sectors, Bloomberg reports.
“The history, positioning and lack of a favorable catalyst point to continued near-term challenges for AI
momentum trading in infrastructure despite solid fundamentals.”
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