Institutional Investors Rapidly Divest US Equities Amid Market Shift

Institutional investors are actively divesting from U.S. equities, with hedge funds selling single stocks at the fastest pace since October. The Kobeissi Letter posted on X that this marks the second consecutive day of significant sales, primarily driven by short sales and, to a lesser extent, the liquidation of long positions. Over the past six days, there have been net outflows on five occasions. The sectors most affected by this trend include Information Technology, Industrials, and Materials, with Semiconductor and Semiconductor Equipment, Communications Equipment, and Tech Hardware experiencing the most significant pressure. This activity indicates a shift in sentiment among hedge funds.