Hedge funds are scaling back positions in US stocks and reallocating capital toward European markets, according to a new analysis by Goldman Sachs. The shift reflects growing concerns over US market valuation, interest rate policy, and political instability. European equities, particularly in Germany and France, have become increasingly attractive due to stronger corporate earnings momentum and more stable regulatory environments. The move marks a significant tactical change in global asset allocation, with fund managers seeking diversification and risk mitigation.
The trend underscores a broader reassessment of global investment strategy as inflation pressures and geopolitical risks persist.