STOCKS | UBS Says Hedge Funds Cut Momentum and Semiconductor Longs by 5%

Hedge funds have reduced long positions in momentum and semiconductor stocks by about 5% of total market value, according to UBS prime brokerage data. According to Odaily, UBS said the move was one of the largest de-risking episodes on record, with net positioning in semiconductors and software falling back to April levels. UBS said the selloff in momentum stocks is close to ending and expects it to bottom out before the end of July. The bank also recommended that investors gradually rebuild positions in AI and semiconductor stocks. UBS said recent gains in banks and other cyclical stocks were mainly driven by short covering, and those sectors could face pressure if funds move back into AI.