By Carolina Mandl
NEW YORK (Reuters) – Global hedge funds went on a stock-buying spree just ahead of a U.S. jobs report that drove the S&P 500 and Nasdaq to their highest closing levels since early 2022, a Morgan Stanley’s prime brokerage note showed.
“What started out as a somewhat quieter week turned on Thursday, as hedge funds shifted to buying equities in what amounted to the largest day of buying seen in recent months,” the bank’s prime brokerage strategic content group said.
Morgan Stanley said hedge funds bought mainly stocks in North America, in a mix of additions of long positions and short covering.
The buying wave came on a day the Nasdaq ended sharply higher after Alphabet and Advanced Micro Devices sparked a megacap rally on fresh optimism about artificial intelligence.
Morgan Stanley said hedge funds reversed their recent strategy of selling mega-cap names amidst the rally in technology, adding back stocks in the sector.
Hedge funds also bought stocks in materials and financials last week, while adding short positions in energy, mainly in the oil and gas sector.
(Reporting by Carolina Mandl in New York; editing by Jason Neely)
