SunGard’s hottest stocks
28 October 2015 London
Image: Shutterstock
SunGard’s Astec Analytics has compiled its list of the most desirable stocks for securities lending for the week beginning 26 October.
Publicis Groupe, a French advertising group, came in first place for Europe, the Middle East and Africa (EMEA) after it slashed its annual organic growth target following flat sales in September.
Regardless, short sellers have not leapt on the news and have instead continued to cover their positions for the previous two weeks. In fact, borrowing interest in the advertising group has actually fallen by 52 percent.
LivaNova, the newly created product of a merger between Sorin SpA and Cyberonics earlier in October, came straight in at second place for the EMEA.
The first week of borrowing activity was met by a surge of interest, jumping from just 300,000 shares on the first day to about 2.7 million three days later, although “early signs already suggest this may be tapering out”, according to Astec Analytics.
The cost of borrowing shares in the new entity held at 50 basis points. End of week trading saw a 30 percent drop off in volumes.
A less surprising entrant in the list is the Luxembourg-based steelmaker ArcelorMittal. Credit Suisse revised its rating from ‘outperform’ to ‘neutral’ in reaction to ongoing global growth concerns and the soft commodity market.
Borrowing volumes are up 23 percent as short sellers continue to take a bearish stance towards the commodity provider.
In the Americas, it was the well-known US logistics company FedEx that caught the markets’ attention. Its €4.4 billion takeover of rival TNT was implied to be all but certain to receive approval from the European Commission, causing its share price and caused borrowing volumes to fall 24 percent over the past two weeks.
In second place was another major US brand, Weight Watchers International. The company enjoyed a massive boost in share price after TV megastar Oprah Winfrey publicly invested in a 10 percent stake in the dieting company. Shares doubled overnight and peaked just shy of triple the pre-announcement price.
Astec Analytics noted: “This side of the market is attempting to make money on the shares being overbought—a classic signal when a large increase in price is met by a large increase in borrowing—with the number of Weight Watchers shares being borrowed climbing 25 percent over this same period.”
In the Asia Pacific, Australian energy company Santos jumped straight to the top-spot after it rejected a AUD $7.1 billion (US $5 billion) takeover offer from investment group Scepter Partners. The offer was described as “opportunistic in nature” by the energy provider.
Santos is another victim of the soft commodities market but short sellers seemed to side with the energy provider and began to cover their positions. Borrowing volumes fell 19 percent since 6 October.
China’s Evergrande Real Estate Group reappeared in the hottest stocks list after it agreed to pay HK $7 billion (US $900 million) for a property development project in the city of Chongqing in Southwest China.
The news caused share price to go up and borrowing volume went down 18 percent as short sellers covered positions for a second week.
Publicis Groupe, a French advertising group, came in first place for Europe, the Middle East and Africa (EMEA) after it slashed its annual organic growth target following flat sales in September.
Regardless, short sellers have not leapt on the news and have instead continued to cover their positions for the previous two weeks. In fact, borrowing interest in the advertising group has actually fallen by 52 percent.
LivaNova, the newly created product of a merger between Sorin SpA and Cyberonics earlier in October, came straight in at second place for the EMEA.
The first week of borrowing activity was met by a surge of interest, jumping from just 300,000 shares on the first day to about 2.7 million three days later, although “early signs already suggest this may be tapering out”, according to Astec Analytics.
The cost of borrowing shares in the new entity held at 50 basis points. End of week trading saw a 30 percent drop off in volumes.
A less surprising entrant in the list is the Luxembourg-based steelmaker ArcelorMittal. Credit Suisse revised its rating from ‘outperform’ to ‘neutral’ in reaction to ongoing global growth concerns and the soft commodity market.
Borrowing volumes are up 23 percent as short sellers continue to take a bearish stance towards the commodity provider.
In the Americas, it was the well-known US logistics company FedEx that caught the markets’ attention. Its €4.4 billion takeover of rival TNT was implied to be all but certain to receive approval from the European Commission, causing its share price and caused borrowing volumes to fall 24 percent over the past two weeks.
In second place was another major US brand, Weight Watchers International. The company enjoyed a massive boost in share price after TV megastar Oprah Winfrey publicly invested in a 10 percent stake in the dieting company. Shares doubled overnight and peaked just shy of triple the pre-announcement price.
Astec Analytics noted: “This side of the market is attempting to make money on the shares being overbought—a classic signal when a large increase in price is met by a large increase in borrowing—with the number of Weight Watchers shares being borrowed climbing 25 percent over this same period.”
In the Asia Pacific, Australian energy company Santos jumped straight to the top-spot after it rejected a AUD $7.1 billion (US $5 billion) takeover offer from investment group Scepter Partners. The offer was described as “opportunistic in nature” by the energy provider.
Santos is another victim of the soft commodities market but short sellers seemed to side with the energy provider and began to cover their positions. Borrowing volumes fell 19 percent since 6 October.
China’s Evergrande Real Estate Group reappeared in the hottest stocks list after it agreed to pay HK $7 billion (US $900 million) for a property development project in the city of Chongqing in Southwest China.
The news caused share price to go up and borrowing volume went down 18 percent as short sellers covered positions for a second week.
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