By Nell Mackenzie
LONDON (Multibagger) - Discover the latest insights from a Goldman Sachs note to clients, revealing that hedge funds have significantly increased their holdings in commodity sensitive stocks during the week ending July 5. This surge in investment marks the fastest pace seen in five months, as reported by Multibagger on Monday.
Despite a decrease in energy stocks last week due to Tropical Storm Beryl impacting the Caribbean, major players such as Chevron Corp (NYSE:), Exxon Mobil (NYSE:), and Shell (LON:) experienced declines ranging from 0.5% to just over 1.5%.
However, energy and materials stocks emerged as top choices among hedge funds on the bank's prime brokerage desk, showcasing a notable preference for oil and gas companies, containers and packaging firms, as well as metals and mining entities.
On the flip side, hedge funds showed less interest in stocks related to paper, forest products, and chemicals, with these sectors experiencing more modest selling activities than buying.
Overall, commodity sensitive sectors have been on a three-week streak of net buying, primarily driven by hedge funds capitalizing on trades that bet on increasing asset prices, according to the bank's analysis.
Furthermore, the past week saw a resurgence of hedge fund activity in global stocks, with a majority of regions witnessing more buying than selling for the first time in three weeks. Notably, Europe and Asia led the way, while Chinese equities continued to be net sold for the fourth consecutive week.
Among global sectors, industrials, financials, and energy stood out as the most favored by hedge funds, whereas communication services, tech, and utilities saw the highest selling activities, as per the bank's findings.
Don't miss out on these key insights into hedge funds' investment strategies and the latest trends in commodity sensitive stocks. Stay informed and make informed decisions to maximize your financial gains!