The Short Report – 25 May 2023

Weekly Reports | May 25 2023

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By Greg Peel

Week Ending May 18, 2023.

Towards the end of last week, the ASX200 initially fell hard, led by Wall Street’s debt ceiling fears, before rebounding sharply when Biden (prematurely) suggested optimism. The index tested support at 7200 and it held.

As I write, the index has dropped through 7200 on ongoing debt ceiling concerns and this time may struggle to hold until there is a resolution.

There was very little movement in short positions over the week.

One move was in Appen ((APX)), which I suggested in last week’s report would likely fall further than the -9.6% it did, having leapt up to 10.5% shorted the week before from 5.6% after announcing a capital raising.

Raisings spur short arbitrage positions against receiving discounted stock. Clearly the process is not over yet, unless there remain those happy to stay short.

Weekly short positions as a percentage of market cap:

FLT     11.9

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