Hedge funds significantly increased their investments in US technology and media stocks last week amid expectations of a 50 basis point interest rate reduction by the US Federal Reserve, according to a report by Reuters.

The report cites a report from the prime brokerage unit at Goldman Sachs as revealing that the rate of buying was the fastest seen in four months.

The Federal Reserve’s first rate cut in four years gave a lift to US markets, with the S&P 500 index closing 1.15% higher last Friday. This rally came as recession fears subsided and investors began to factor in the benefits of a more accommodating monetary policy.

Hedge funds overwhelmingly backed the technology sector, placing nearly three times more long positions – bets that stock prices will rise – on information technology stocks compared to short positions, according to Goldman’s note. The report highlighted a strong focus on semiconductor and related equipment companies, where buying activity surpassed selling in tech hardware businesses, including manufacturers of computers, monitors, and hard drives.

Additionally, hedge funds abandoned short positions and placed long bets on interactive media and entertainment companies, further boosting their exposure to the sector. The broader technology and media sector now accounts for almost one-third of overall US net portfolio exposure for hedge funds, Goldman Sachs reported.

On the other hand, consumer products saw the most significant selling activity. For the first time in four weeks, US consumer discretionary stocks—such as hotels and restaurants—experienced more selling than buying, leading to the largest net selling of the sector in a year.

Gross leverage, a measure of total borrowing and investments by hedge funds, hit approximately 278%, among the highest levels recorded this year, according to the note.