The Short Report – 25 Jun 2020

Weekly Reports | Jun 25 2020

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

Summary:

Week ending June 18, 2020

Last week opened with the ASX200 tanking along with Wall Street as the US case-count climbed and the Fed warned of a weak economy. There followed a recovery of around half that loss, and until today the index tracked sideways.

I was right about one thing in last week’s Report: Super Retail ((SUL)) shorts fell to 8.0% last week from 10.1% after a surprisingly positive trading update had the stock shooting up 10% on the day.

But I was wrong to assume this would only leave Myer ((MYR)) as over 10% shorted, given Perpetual ((PPT)) shorts rose to 10.3% from 8.2%. The fund manager has not performed well through the crisis, and the sharp market pullback at the beginning of the week would not have helped.

These were the only two short position changes of one percentage point or more last week, but we might note three stocks that were for so long stuck in the 10%-plus club continue to move further down the table, being lithium miners Galaxy Resources ((GXY)) and Orocobre ((ORE)) and stay-at-home beneficiary JB Hi-Fi ((JBH)).

We might also note that the prior steady trend of the number of stocks shorted by 5% or more reducing each week reversed last week, with a net three stocks being added.

The four stocks reappearing are all familiar faces in short table terms.

Weekly short positions as a percentage of market cap:

10%+
MYR   13.0
PPT     10.3


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