Global borrow demand boosted by $10bn
09 September 2015 New York
Image: Shutterstock
Global borrow balances grew by more than $10 billion in the first week of September with some industries reporting more than $1 billion of stock value fluctuations, according to S3 Blacklight.
The data analytics provider noted that 150 of 170 recognised sectors categories experienced an increased in borrowing activity in a single week.
Predictably, index funds and exchange-traded funds easily topped S3 Blacklight’s list of ‘industry categories with over $1 billion new borrows’, with much maligned oil and gas companies taking second place, closely followed by the pharmaceutical sector.
Other notable entries include Silicon Valley heavyweights Facebook and Google, along with multinational banks such as Bank of America and Wells Fargo.
When comparing regional activity, Asia stood out for both positive and negative reasons. Japan boasted significant growth with Nikon Corp attracting over $1 billion in borrows, with $150 million new borrows last week alone.
Today’s positive market gains could stall the growing number of borrows, however, as the Toyko Stock Exchange marked its largest single session jump in nearly seven years.
Japan’s Nikkei 225 Index recovered by 7.7 percent after several week’s of spiralling stock prices across Asia, driven by the turmoil in China.
Elsewhere in Asia, the mood isn’t as positive. The Taiwan Financial Supervisory Commission was forced to introduce an uptick rule that prevented short selling for less than the closing price for the previous trading day after its technology industry saw increased activity.
Regional brands such as Taiwan Semiconductor (TSM US) and Hon Hai Precision (2317 TT) bore the brunt of shorting interest with over $100 million in new borrows each.
The global repercussions of China’s recent stock crash is well documented already and today’s pledge by the Chinese state to increase infrastructure spending and establish new fiscal policies did succeed in rallying the market, which today closed 2.3 percent higher.
But S3 Blacklight data highlighted ongoing pessimism in Asia as shorts in Alibaba Group alone still accounted for $800 million of new borrows last week.
Total borrows for the online retailers are nearing $3.5 billion and the stock continues to be the most borrowed in the region.
Although it is worth noting that this does goes against the wider trend of the Chinese market with total borrows down by over two thirds to $250 million and down $200 million in the last week.
Almost $100 million of borrows were returned in China last week, bringing total outstanding balances down to $250 million and could represent light at the end of the tunnel for China and the wider Asia Pacific region.
The data analytics provider noted that 150 of 170 recognised sectors categories experienced an increased in borrowing activity in a single week.
Predictably, index funds and exchange-traded funds easily topped S3 Blacklight’s list of ‘industry categories with over $1 billion new borrows’, with much maligned oil and gas companies taking second place, closely followed by the pharmaceutical sector.
Other notable entries include Silicon Valley heavyweights Facebook and Google, along with multinational banks such as Bank of America and Wells Fargo.
When comparing regional activity, Asia stood out for both positive and negative reasons. Japan boasted significant growth with Nikon Corp attracting over $1 billion in borrows, with $150 million new borrows last week alone.
Today’s positive market gains could stall the growing number of borrows, however, as the Toyko Stock Exchange marked its largest single session jump in nearly seven years.
Japan’s Nikkei 225 Index recovered by 7.7 percent after several week’s of spiralling stock prices across Asia, driven by the turmoil in China.
Elsewhere in Asia, the mood isn’t as positive. The Taiwan Financial Supervisory Commission was forced to introduce an uptick rule that prevented short selling for less than the closing price for the previous trading day after its technology industry saw increased activity.
Regional brands such as Taiwan Semiconductor (TSM US) and Hon Hai Precision (2317 TT) bore the brunt of shorting interest with over $100 million in new borrows each.
The global repercussions of China’s recent stock crash is well documented already and today’s pledge by the Chinese state to increase infrastructure spending and establish new fiscal policies did succeed in rallying the market, which today closed 2.3 percent higher.
But S3 Blacklight data highlighted ongoing pessimism in Asia as shorts in Alibaba Group alone still accounted for $800 million of new borrows last week.
Total borrows for the online retailers are nearing $3.5 billion and the stock continues to be the most borrowed in the region.
Although it is worth noting that this does goes against the wider trend of the Chinese market with total borrows down by over two thirds to $250 million and down $200 million in the last week.
Almost $100 million of borrows were returned in China last week, bringing total outstanding balances down to $250 million and could represent light at the end of the tunnel for China and the wider Asia Pacific region.
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