Published by Global Banking & Finance Review®
Posted on February 24, 2026
2 min readLast updated: April 2, 2026
Add as preferred source on GoogleHedge funds resumed buying big tech and AI‑exposed stocks, with software stabilizing after steep losses, JPMorgan says. Goldman reports leverage near a one‑year high as equity flows pivot toward defensives.
By Nell Mackenzie
LONDON, Feb 24 (Reuters) - Hedge funds last week bought the biggest tech stocks as well as those considered vulnerable to advances in artificial intelligence, said a note to clients from JPMorgan seen by Reuters on Tuesday.
The world's most valuable technology stocks have suffered sharp declines this year after years of outsized gains, as investors question whether heavy spending on AI will generate sufficient returns to justify the lofty valuations.
"While positioning remains very stretched between Semis and Software (globally, in the U.S., and in Europe), the rotation seemed to slow or reverse a bit," said the note to clients.
Software stocks saw some buying after being sold down by historic amounts the week before, the bank said, without putting a timeframe on the comparison.
Hedge fund leverage increased from the week ending February 14 and is nearing its highest level in a year, said a separate note from Goldman Sachs seen by Reuters on Tuesday.
It said net sales orders in global equities had hit their highest level since U.S. President Donald Trump announced a barrage of import tariffs last April.
Financial stocks were the sector with the highest net sales, while energy, health care and staples saw the greatest net buying, said Goldman Sachs. It did not break down the financial stocks into sub-categories.
(Nell Mackenzie; Editing by Dhara Ranasinghe and Kevin Liffey)
Hedge funds are moving back into large technology and AI‑exposed stocks after weeks of selling. JPMorgan notes a slowing rotation, while Goldman says leverage is nearing a one‑year high.
Managers appear to be selectively re‑risking in major tech and AI themes after steep declines, with early signs of stabilization in software and a pause in the semis‑over‑software rotation.
Financials had the highest net selling. Net buying was strongest in energy, healthcare and consumer staples, suggesting a tilt toward defensives.
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