© Reuters. FILE PHOTO: A trader works on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., July 19, 2023. REUTERS/Brendan McDermid/File Photo

By Carolina Mandl and Nell Mackenzie

NEW YORK/LONDON (Reuters) – Hedge funds ditched energy stocks last week for the first time in three weeks, despite a rally in oil prices triggered by the prospect of a widening supply deficit, Goldman Sachs said in a report.

The move, according to the bank’s prime brokerage unit, was mainly led by short sales, meaning that hedge funds were speculating on a decline in energy stocks’ prices. The bank said sales occurred in both North America and Europe.

Goldman Sachs, as one of the biggest providers of lending and trading services to investors through its prime brokerage unit, is able to track hedge funds’ investment trends.

Overall, Goldman Sachs said hedge funds’ trading book was underweight energy stocks at levels approaching a May 2020 low. It added hedge funds increased their short bets on U.S. energy stocks, besides oil, gas, consumable fuels and energy equipment and services.

Earlier this month, Saudi Arabia and Russia extended a combined 1.3 million barrels per day of supply cuts to the end of the year, spurring predictions that benchmark prices could surpass $100 a barrel this year.

See also  Crypto.ro and Binance Present the 3rd Binance Meetup in Romania, Happening in Timisoara

However, China’s sluggish post-pandemic economic recovery has also raised concerns that demand may slow down.


Source link

(This article is generated through the syndicated feed sources, Financetin doesn’t own any part of this article)

Leave a Reply

Your email address will not be published. Required fields are marked *