The Short Report

By Rudi Filapek | More Articles by Rudi Filapek

Guide:

The Short Report draws upon data provided by the Australian Securities & Investment Commission (ASIC) to highlight significant weekly moves in short positions registered on stocks listed on the Australian Securities Exchange (ASX). Short positions in exchange-traded funds (ETF) and non-ordinary shares are not included. Short positions below 5% are not included in the table below but may be noted in the accompanying text if deemed significant.

Please take note of the Important Information provided at the end of this report. Percentage amounts in this report refer to percentage of ordinary shares on issue.

Stock codes highlighted in green have seen their short positions reduce in the week by an amount sufficient to move them into a lower percentage bracket. Stocks highlighted in red have seen their short positions increase in the week by an amount sufficient to move them into a higher percentage bracket. Moves in excess of one percentage point or more are discussed in the Movers & Shakers report below.

Summary:

Week ending August 8, 2019

Last week saw the ASX200 tank in line with Wall Street on China currency fears before grinding out a modest recovery. Today is a different story.

In last week’s Report I suggested the run to the high itself might explain why there was a lot more red than green on the table below, yet this week we see all red in the downturn bar one stock.

While a drop in CSR ((CSR)) shorts would reflect last week’s sympathy rally after peer James Hardie ((JHX)) posted a very strong earnings report, elsewhere it would appear most short increases are in anticipation of earnings reports to come. AMP ((AMP)) is the only stock to have already reported (poorly).

It is worth noting that of the 14 stocks shorted by 10% or more, four are battery-related, reflecting the volatility in the EV/battery demand versus lithium/graphite/etc supply argument, and four are agriculture-related. Top two shorted Inghams Group ((ING)) and Nufarm ((NUF)) reflect the drought story while Bellamy’s ((BAL)) and Bega Cheese ((BGA)) are more about Chinese risks.

Nufarm shorts rose to 19.2% last week from 17.8% and Bega’s rose to 10.7 from 9.7%.

Harvey Norman ((HVN)) shorts rose to 10.6% from 9.6% to put it in the 10% club alongside peer JB Hi-Fi ((JBH)) on 14.4%, but JB Hi-Fi reported the day after and sparked a short-covering rally. Stay tuned for next week.

Shorts in nickel miner Western Areas ((WSA)) jumped to 8.6% from 7.3% on a supply-side related rally for the nickel price some analysts see as only temporary.

The earnings season will begin to have more of an impact in next week’s report before the last two weeks of August bring an absolute flood of results. And this before a macro backdrop of escalating volatility. Could get interesting for the shorters.

That about covers it. No Movers & Shakers this week.

Weekly short positions as a percentage of market cap:

10%+
ING     19.4
NUF    19.2
BAL    16.0
ORE    16.0
GXY   15.9
JBH     14.4
NXT    14.0
SYR    13.6
BWX   12.1
DMP   11.8
PLS     11.7
HUB   11.3
BGA   10.7
HVN   10.6

In: BGA, HVN

9.0-9.9

BIN, RWC, MTS, IFL, SGM, BOQ, AMP, KGN

In: BOQ, AMP, KGN                        Out: BGA, HVN

8.0-8.9%

PPT, WSA, IVC, SDA, GWA, SUL

In: WSA, GWA                      Out: AMP, BOQ, KGN, CSR

7.0-7.9%

BKL, CLH, CGC, CSR, MYR, CGF, DCN

In: CSR                       Out: WSA, GWA

6.0-6.9%

GEM, NEC, ELD, A2M, NCZ, GMA, COE

In: NCZ, COE

5.0-5.9%

CTD, LNG, SFR, CLQ, SAR, MSB, OML, SXY, NWL, CUV

In: CUV                      Out: NCZ, COE

Movers & Shakers

See above.

  ASX20 Short Positions (%)

Code Last Week Week Before Code Last Week Week Before
AMC 0.9 0.9 RIO 4.7 4.4
ANZ 0.7 0.7 S32 1.4 1.4
BHP 3.0 2.9 SCP 0.7 0.6
BXB 0.3 0.2 SUN 0.5 0.3
CBA 1.1 1.1 TCL 0.8 0.8
COL 1.0 1.0 TLS 0.4 0.3
CSL 0.3 0.3 WBC 1.1 1.0
IAG 0.4 0.4 WES 1.1 1.2
MQG 0.7 0.7 WOW 1.8 1.6
NAB 0.6 0.6 WPL 0.9 0.9
Rudi Filapek

About Rudi Filapek

Rudi Filapek-Vandyck is approaching three decades as an active journalist. During the nineties, Rudi successfully built a financial news wire in Europe. After arriving in Australia in 2000, he worked on several projects before founding FNArena.

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