Fidelity Cuts Holdings in Technology Stocks

Fidelity Investments, the biggest U.S. mutual fund company, said it cut its holdings in technology stocks for the second straight month in October, while building cash levels in its biggest funds.

Robert Stansky, manager of Fidelity’s $92.6-billion Magellan Fund, trimmed the fund’s technology stake to 25.1% as of Oct. 31 from 29.2% on Sept. 30.

“It’s a very bearish read on technology from Bob Stansky, who has more than a decade of experience moving in and out of technology in a fairly precise manner,” said Jim Lowell, editor of Fidelity Investor, a monthly newsletter.

Stansky also raised the fund’s cash holdings to 6.9%, up from 3.7%, the highest since October 1999.

Mutual fund managers have been building cash levels as the Standard & Poor’s Technology index fell 34% since the end of August. Stock fund cash levels are at the highest level since November 1998.

Magellan, the largest actively managed U.S. mutual fund, has seen its assets fall 14% this year--from $105.9 billion on Dec. 31, 1999. The fall largely reflects declining share prices rather than investor withdrawals.