Global equities net bought for a second straight week: Goldman Sachs

Investing.com — Global equities experienced net buying for a second consecutive week, with long positions outpacing short sales by a ratio of 1.9 to 1, Goldman Sachs said in a recent report.

Trading activity continued to gain momentum, marking its ninth straight week of increased volume.

All major regions saw net buying, with North America and developed markets in Asia leading the way. Both macro products and single stocks contributed to the inflows, accounting for 60% and 40% of the total net buying, respectively.

On a sector level, Financials, Consumer Staples, Consumer Discretionary, and Real Estate were the most heavily purchased globally. Meanwhile, Information Technology, Materials, Communication Services, and Industrials were the most net sold sectors.

Consumer Staples stood out as one of the most purchased global sectors, with long buying significantly outpacing short sales by a ratio of 5 to 1. The sector was net bought across all regions, with the largest inflows coming from Europe, followed by Asia and the US.

Goldman Sachs notes that hedge funds (HFs) have been steadily increasing their exposure to Consumer Staples stocks over the past five weeks, with this week’s buying ranking as the highest since August 2023 and among the top 5% over a five-year period.

“Nearly all global Staples subsectors (sans Personal Care Products) were net bought on the week, led by Beverages and Food Products,” the bank said in the report.

Regionally, Japanese equities saw notable activity, with hedge funds increasing their net buying for the second week in a row.

The long/short ratio in Japanese stocks climbed to a three-year high ahead of the Bank of Japan (BoJ) meeting next week.

According to Goldman, Japan has become one of the most purchased markets globally within prime brokerage accounts, particularly following the US elections.