The Short Report – 26 Mar 2020

Weekly Reports | Mar 26 2020

See Guide further below (for readers with full access).

Summary:

Week ending March 19, 2020

Last week saw more of the same for the ASX200, including the biggest one-day fall since 1987.

In the prior couple of weeks of correction, changes in short positions on the ASX had been fairly negligible under the circumstances, with a few exceptions. That all changed last week as we officially hit a technical bear market and kept going.

At least, according to the ASIC data. Were this any normal week, I’d be dismissing the range and extent of such moves in one week as data error, as has happened so often before. But we live in extraordinary times. So we’ll take it as written, unless next week’s data dispute.

All short position changes are noted in percentage points:

Falling over -4ppt was Syrah Resources ((SYR)), with battery-related peers Galaxy Resources ((GXY)) falling over -2ppt and Orocobre ((ORE)) over -1ppt. Short positions in this group are highly volatile at the best of times.

Metcash ((MTS)) fell over -2ppt, with supermarket shelves being ransacked. JB Hi-Fi ((JBH)) fell -2ppt on a rush for home entertainment. Super Retail ((SUL)) shorts fell over -2% as brokers called the stock oversold. Blackmores ((BKL)) fell over -1ppt, perhaps as conditions ease in China.

The travel industry is clearly the epicentre of disaster. Last week Webjet ((WEB)) went into trading halt pending a (failed) capital raising. Shorts had fallen over -1ppt. Flight Centre ((FLT)) has this week gone into a trading halt for the same reason. Last week shorts rose over 2ppt. Corporate Travel Management ((CTD)) shorts fell over -3ppt as brokers pointed to a strong balance sheet.

This week oOh!media ((OML)) went into a trading halt pending a capital raising. Last week shorts rose over 2ppt.

Nearmap ((NEA)) was having problems even before the corona-crash and had fallen -68% from January. Last week shorts fell over -2ppt, presumably on profit-taking.

It should be noted, of course, all of the above stocks have been trashed by varying extents.

A small mention goes to BHP Group ((BHP)), which has joined the table on 5.2% shorted, up from 4.7% the week before. That’s a big short for a big company.

Weekly short positions as a percentage of market cap:

10%+
GXY   18.4
SYR    15.4
ORE    13.2
SDA    13.2
ING     11.7
MTS    10.6
NCZ    10.1


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