Hedge funds’ sec lending trends for November revealed
23 November Frankfurt
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Deutsche Bank has published its analysis of hedge funds’ securities lending trends for October.
In the US, equities rallied as funds began to unwind their positions.
Deutsche Bank specifically saw its short selling exposure decrease by 10.5 percent over the month.
The materials, energy and IT sectors saw the greatest monthly drop in short exposure.
Meanwhile, Sprint, Consol Energy, Century Aluminum, BNY Mellon and Morgan Stanley saw the greatest net addition to short exposure.
In Europe, Volkswagen’s emissions scandal continued to cause waves in the market.
The vehicle manufacturer announced further cuts to Capex, which brought the attention of short sellers to Capex-dependent automotive suppliers, such as Kuka and Duerr.
M&A activity also had a major impact on the European market.
ABI Inbev concluded one of the largest acquisitions in history when it took on SABMiller and Potash Corp dropped its €41 per share offer to acquire K+S.
K+S in particular regained a lot of its shorting interest once the acquisition deal fell through.
At the same time, a number of companies that missed their Q3 earnings targets or issued profit warnings also endured significant stock decline and increased shorting attention.
In China and Hong Kong, Great Wall Motors repeatedly made headlines as its borrow rates soared to over 7.5 percent and shorting interest peaked at over 50 percent.
In conjunction with this theme, borrow interest for other automakers, such as Byd Co, Brilliance China Automotive, Geely Automobile Holdings, and CAR Inc.
Regionally in Asia, short flow was quiet around South Korea and Taiwan, although borrow returns remained in the Samsung group names.
In Japan the Nikkei also rallied after a difficult September to finish around 10 percent up for October.
The Bank of Japan maintained its monetary policy at its meeting as Governor Kuroda bet that expanding the monetary base at an annual pace of JPY 80 trillion ($650.8 billion) will be enough to meet the 2 percent inflation target.
In the US, equities rallied as funds began to unwind their positions.
Deutsche Bank specifically saw its short selling exposure decrease by 10.5 percent over the month.
The materials, energy and IT sectors saw the greatest monthly drop in short exposure.
Meanwhile, Sprint, Consol Energy, Century Aluminum, BNY Mellon and Morgan Stanley saw the greatest net addition to short exposure.
In Europe, Volkswagen’s emissions scandal continued to cause waves in the market.
The vehicle manufacturer announced further cuts to Capex, which brought the attention of short sellers to Capex-dependent automotive suppliers, such as Kuka and Duerr.
M&A activity also had a major impact on the European market.
ABI Inbev concluded one of the largest acquisitions in history when it took on SABMiller and Potash Corp dropped its €41 per share offer to acquire K+S.
K+S in particular regained a lot of its shorting interest once the acquisition deal fell through.
At the same time, a number of companies that missed their Q3 earnings targets or issued profit warnings also endured significant stock decline and increased shorting attention.
In China and Hong Kong, Great Wall Motors repeatedly made headlines as its borrow rates soared to over 7.5 percent and shorting interest peaked at over 50 percent.
In conjunction with this theme, borrow interest for other automakers, such as Byd Co, Brilliance China Automotive, Geely Automobile Holdings, and CAR Inc.
Regionally in Asia, short flow was quiet around South Korea and Taiwan, although borrow returns remained in the Samsung group names.
In Japan the Nikkei also rallied after a difficult September to finish around 10 percent up for October.
The Bank of Japan maintained its monetary policy at its meeting as Governor Kuroda bet that expanding the monetary base at an annual pace of JPY 80 trillion ($650.8 billion) will be enough to meet the 2 percent inflation target.
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