The Short Report – 22 Oct 2020

Weekly Reports | Oct 22 2020

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

Summary:

Week ending October 15, 2020.

Last week saw the ASX200 kick on from the prior budget-driven week to post further gains as Victorian restrictions began to be eased. The prospect of further easing is looking a little dicey today.

I noted last week that the budget rally had appeared to prompt somewhat of a short-covering scramble, given the number of stocks seeing positions reduced. But I wanted to wait until this week for confirmation it wasn’t one of ASIC’s occasional data blips.

Well, it wasn’t. Thus what we’re left with is a not a lot of changes in positions last week.

Only one stock saw a position change of one percentage point or more. Flight Centre ((FLT)) shorts rose to 8.1% from 6.8%. The shorters are no doubt looking to the second wave crisis in Europe/UK and assuming international borders will not be reopened anytime soon.

On that basis, Credit Suisse downgraded to Neutral from Outperform last week.

The only other point of note from last week is that shorters appear to be moving in on biotechs.

Mesoblast ((MSB)) is sitting there at 9.1% shorted having failed to receive FDA approval for its remestemcel-L drug, which prompted a -37% share price plunge on the news earlier in the month.

Ticking up to 6.4% last week was PolyNovo ((PNV)), while making a debut appearance at 5.1% was Pro Medicus ((PME)).

No Movers & Shakers this week.

Weekly short positions as a percentage of market cap:

10%+
WEB   14.7
IVC     10.0


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