Goldman Sachs: Expects $40 billion in stock sell-off next week.

Goldman Sachs, in a note to clients, said the S&P 500's fall below a closely watched level has given the green light to trend-following hedge funds, which could sell nearly $40 billion worth of stocks in the coming week. The S&P 500 fell below 6725 points on Wednesday. The note, sent to clients later that day, stated that trend-following hedge funds treat this threshold as a signal to either sell positions or increase short bets on further declines in stocks. Goldman Sachs' calculations show that after the price fell below this level, $39 billion worth of stocks could be sold globally in the following week. If prices continue to fall, the bank estimates that systematic trend-following hedge funds could sell up to approximately $65 billion worth of stocks. Trend-following hedge funds aim to capitalize on signals at the start of a market trend—whether it's upward or downward. These signals can be based on trading volume, price, or the speed of asset price changes during a trading day. A Goldman Sachs report stated that these hedge funds had taken a long position in global equities worth approximately $150 billion before the sell-off began. Goldman Sachs noted that the last time stock prices fell below these closely watched levels was in October, prior to which US President Trump announced a series of tariff proposals on April 2nd. (Jinshi)