Short Sellers Moving On To "Safe" Companies

Short sellers are still betting that financial shares will fall but they have boldly moved into shares of companies which are considered healthy, those with both good balance sheets and relatively strong earnings prospects.Data is as of the end of October.

The short interest in AIG (AIG) rose 44% to 135.7 million shares. Short interest in Citigroup (C) rose 18% to 138 million. Shares short in Morgan Stanley (MS) were up 85% to 44 million. Shares short in Well Fargo (WFC) jumped 14% to 151.4 million. The short interest in American Express (AXP) rose 37% to 30.3 million.

"Safe" companies were also attacked by short sellers. Shares short in P&G (PG) rose 39% to 46.3 million. The short interest in GE (GE) rose 18% to 79.8 million. Shares short in AT&T (T) rose 30% to 41 million. The short interest n Caterpillar (CAT) was up 31% to 26.7 million.Short interest in Exxon (XOM) rose 18% to 39.5 million. Shares short in Microsoft (MSFT) rose 20% to 82.8 million. Shares short in Oracle (ORCL) were up 37% to 43.6 million. Short interest in Cisco CSCO) rose 9% to 61.4 million. Shares short in Apple (AAPL) moved up 16% to 28.1 million

Read the whole story here.

Comments

[PT6]

It is not too late to recapture what has been taken from AMERICA!

Where there is a will there is a way! The courts offer the WAY!

Unpunished they will do it again the NEXT CHANCE THEY GET!

EVEN TODAY, because the risk of capture and prosecution is so low, the corrupt are continuing to SHORT OUR MARKETS AND RUIN OUR COMPANIES and our FUTURE!

[mrcontinental]

Take the bait if you like folks but don't forget what Porsche pulled a few weeks ago when they bought Volkswagen. NO ONE say that coming and many were vaporized.

[PT6]

WHY IS "SHORT SELLING" and PUT OPTIONS BEING ALLOWED IN THIS MARKET!

SHUT THEM DOWN OR WE WILL ALL BE BANKRUPT!

[nabrum]

If Obama wants to fix the economy after 1/20, he'll ban shorting - period. Forever. Selling something you don't own is stupid. And naked shorting which the SEC is still allowing even though it goes against the 1934 act is treason, and should be dealt as such via public firing squad. Then things will turn around.

[iambusto]

why not ban buying stocks in rotten companies like GM/F?

should work both ways no?

[MysticInd]

Totally agree; that's what got up into this mess with the Credit Default Swaps that still haven't shown all their problems because they're not listed; CDS same as short selling; Someone's making a bundle and it would be nice if we could recover 80% of their profit. Redistribute now.

[bored2tears]

How about ban selling altogether?! Yeah, that will solve all the market's ills!

Short selling is selling shares that we have *borrowed!* It is a perfectly legitimate practice that provides liquidity to markets.

All the wishing in the world won't restore Enron or Krispy Kreme. Those who were foolish enough to stay long deserve their fate.

[Sundialsvc4]

Except for P&G (everyone needs soap...) those are simply safe-bets that the economy in general is declining and that therefore, large capital purchases will be deferred. I won't buy next year's "really not that different anyway" software. Won't need to expand my network since I can cabbage parts from the four closed office-buildings. Won't be getting that new iPhone after all, therefore AT&T won't be able to sell all that new high-speed capacity.

And the banks ... well, duh. They've all been doing the same things, so they're all dominoes. As they buy one another up, they just become bigger dominoes.

[bored2tears]

Like Richard Gere in "An Officer and a Gentleman," we got no place else to go.

The biggest mistakes I've made this year have been when I pulled back on the shorts and tried to find something to go long.

It's still true that the trend is your friend.

[joebaggadonuts]

I think the downturn has jumped the proverbial shark.

http://www.ft.com/cms/s/0/834ebf5e-aff9-11dd-a795-0000779fd18c.html?nclick_check=1

When you have Merrill Lynch saying it's 1929 all over again, it feels like the bottom, psychologically, to me. Obama elected, Bush's Uncle Fester (er, Paulson) actually changing course on buying toxic assets, Pelosi wanting to bail out manufacturing infrastructure... it's looking like a bottom. Don't get me wrong here, I think there is another leg down possible, but, we should start to climb a "wall of worry" pretty soon.

[Egalitare]

Infrastructure projects = Caterpillar.

That's as SAFE a play as you can make for the next few years.

[ErnestineBass]

Yep.

Now that China has announced they'll spend half-trillion+ on a stimulus package to improve and expand their infrastructure (meaning they'll be importing a LOT of OUR heavy equipment), I hope the greedy a$$hats shorting Caterpillar lose their shirts.