Hedge funds bought financial stocks after Fed's first rate cut of 2025

Hedge funds piled into financial stocks at the fastest clip in three months last week as the Federal Reserve approved its first rate cut this year, according to Goldman Sachs' prime brokerage data. Financials were the second-most bought global sector on a net basis — behind only tech stocks — and drew steady inflows from professional traders across all five trading sessions last week, according to Goldman. Buying was driven entirely by new long positions, rather than short covering. The notional net buying in financials ranked in the 98th percentile for the past five years, Goldman said. Nearly all financial subsectors attracted buying interest, led by banks, insurers and consumer finance firms. Mortgage REITs were the only area to see outflows, the firm said. The strong purchases came as