The lay of the land
21 October 2014 London
Image: Shutterstock
US budget carrier Jetblue Airways is the most shorted company worldwide ahead of impending Q3 earnings announcements, according to data from Markit.
In Europe, energy services firms are the target of heavy short interest while Hong Kong firms dominate the most heavily shorted firms due to announce earnings in Asia.
According to Markit, demand to borrow shares in Jetblue, which had just over 30 percent of its shares out on loan, has been partly driven by its large stock of convertible debt.
Simon Colvin, research analyst at Markit, said: “This looks to be reinforced by the fact that the recent market stumble appears to have benefited US airlines as the cost of oil now hovers at five year lows; this has seen airlines’ shares outperform the market.”
The oil price collapse is driving European short sellers as well, with two firms that provide geological consulting to oil drillers coming in among the most shorted firms.
This includes TGS Nopec, which has 22.4 percent of shares out on loan making it the most shorted company announcing results in Europe for Q3.
TGS’s competitor, Petroleum Geo Services also makes Markit’s most shorted list after seeing its short interest double in October to 14.1 percent of shares outstanding.
The one UK firm to make the most shorted list is web fashion retailer Asos, which has seen shorts redouble in the wake of poor earnings and a warehouse fire which has hurt operations, according to Markit.
These events have driven the firm’s sales to the lowest level in over two years while short interest surged to a new all-time high.
In Asia, Hong Kong-based company Anhui Conch Cement has 23.5 percent of shares out on loan ahead of results.
Colvin commented: “The firm has proved a tough short since the start of the year, but China’s weakening growth rate looks to have proven short sellers right in the end as its shares have recently fell to new yearly lows.”
Other Hong Kong perennial shorts round out the three most shorted Asian firms ahead of results as China Coal Energy and Yanzhou Coal both have 15.5 and 11.9 percent of shares out on loan respectively.
Outside of Hong Kong, Taiwanese firm Tpk Holding has just under 8 percent of its shares out on loan, a number that has grown by 17 percent in the wake of Samsung’s “disappointing” smartphone sales.
In Europe, energy services firms are the target of heavy short interest while Hong Kong firms dominate the most heavily shorted firms due to announce earnings in Asia.
According to Markit, demand to borrow shares in Jetblue, which had just over 30 percent of its shares out on loan, has been partly driven by its large stock of convertible debt.
Simon Colvin, research analyst at Markit, said: “This looks to be reinforced by the fact that the recent market stumble appears to have benefited US airlines as the cost of oil now hovers at five year lows; this has seen airlines’ shares outperform the market.”
The oil price collapse is driving European short sellers as well, with two firms that provide geological consulting to oil drillers coming in among the most shorted firms.
This includes TGS Nopec, which has 22.4 percent of shares out on loan making it the most shorted company announcing results in Europe for Q3.
TGS’s competitor, Petroleum Geo Services also makes Markit’s most shorted list after seeing its short interest double in October to 14.1 percent of shares outstanding.
The one UK firm to make the most shorted list is web fashion retailer Asos, which has seen shorts redouble in the wake of poor earnings and a warehouse fire which has hurt operations, according to Markit.
These events have driven the firm’s sales to the lowest level in over two years while short interest surged to a new all-time high.
In Asia, Hong Kong-based company Anhui Conch Cement has 23.5 percent of shares out on loan ahead of results.
Colvin commented: “The firm has proved a tough short since the start of the year, but China’s weakening growth rate looks to have proven short sellers right in the end as its shares have recently fell to new yearly lows.”
Other Hong Kong perennial shorts round out the three most shorted Asian firms ahead of results as China Coal Energy and Yanzhou Coal both have 15.5 and 11.9 percent of shares out on loan respectively.
Outside of Hong Kong, Taiwanese firm Tpk Holding has just under 8 percent of its shares out on loan, a number that has grown by 17 percent in the wake of Samsung’s “disappointing” smartphone sales.
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