LONDON, March 31 (Reuters) - Hedge funds last week

ditched tech stocks at the fastest pace in six months and at the

highest levels in five years, according to Goldman Sachs ( GS ),

as world markets tumbled on worries over U.S. President Donald

Trump's April 2 tariff deadline.

Import tariffs and retaliation by U.S. trade partners, along

with government cutbacks under Trump have stoked fears in recent

weeks that the U.S. economy might tip into recession.

Hedge funds fled tech stocks last week, dropping long

positions and getting out of bets against these stocks, Goldman

said in a note to clients on Friday and seen by Reuters on

Monday.

A short position expects an asset value to fall, whereas a

long bet hopes it will rise.

Info tech, which includes so-called Magnificent-7 tech

stocks, was "by far the most net sold on the Prime book this

week", said the note, referring to the bank's prime brokerage

desk which lends to hedge funds and tracks their trades.

Analysts at Edmond de Rothschild on Monday linked the

downward trend in many of these stocks to the expected copper

tariffs due to come into force on April 2.

Hedge funds are increasingly betting against stocks, with

Nvidia ( NVDA ), Advanced Micro Devices ( AMD ) and Tesla

as their top three shorts placed on Wednesday, a Morgan

Stanley note said on Thursday.

U.S. tech stocks made up about 75% of the selling last week,

said Goldman. The selling centered on companies that make

AI-related tech hardware, said the bank.

Total hedge fund exposure to this sector of stocks now

stands at a five-year low, said Goldman.

Hedge funds had bought tech stocks in the middle of March,

but sold them last week, noted another dataset from JPMorgan ( JPM )

. Strong retail buying might also have impacted hedge

fund positions, said the JPMorgan ( JPM ) note to clients on Friday.

A short squeeze occurs when a stock price rises so much that

bearish bets become too expensive to hold and investors are

forced to buy them back, sometimes at a loss.

"With the tariff news, it was interesting that hedge fund

flows and positioning might suggest they're already somewhat

prepared-at least in terms of key areas that have been in

focus," said the JPMorgan ( JPM ) note.