Key facts
- Hedge funds have sold U.S. tech hardware and semiconductor stocks for four consecutive weeks.
- The trend was noted in a Goldman Sachs client note.
- Global chip shares have recently declined.
- The SOX index dropped 4.2% in the week ending July 3.
- The selloff is linked to a selloff in the AI sector.
Hedge funds have extended their divestment from U.S. tech hardware and semiconductor stocks for a fourth consecutive week. This sustained selling activity, detailed in a recent Goldman Sachs client note, indicates a significant shift in investor sentiment towards the sector. The trend is occurring against a backdrop of a broader decline in global chip shares. Specifically, the SOX index, a key benchmark for the semiconductor industry, saw a notable decrease of 4.2% in the week concluding on July 3. This selloff is understood to be closely tied to a recent correction within the artificial intelligence (AI) sector. Companies heavily invested in or reliant on AI technologies and their underlying hardware components appear to be disproportionately affected by this market movement.