Short Sellers Grow More Selective on Major Banks

Banking, finance, and taxes

Published: June 12, 2018 11:03 am

Last Updated: January 11, 2020 10:27 pm

The financial sector was a major part of the Great Recession, and it has been a major part of the recovery and raging bull market since then. Generally speaking, the major financial institutions in the United States are a good barometer of the current state of U.S. markets.

So when short sellers make a play against these major banks, they are effectively betting for a downturn. Conversely, when they back off they might be expecting a surge. Granted, some plays are directly against individual companies, like we saw with Wells Fargo early in 2017.

The May 31 short interest data have been compared with the previous figures, and short interest in most of these selected big bank stocks was mixed.

Bank of America Corp. (NYSE: BAC) saw its short interest rise to 128.83 million shares. The previous level was 113.25 million. Shares were last seen trading at $30.06 in a 52-week range of $22.73 to $33.05.

The number of JPMorgan Chase & Co. (NYSE: JPM) shares short rose to 24.59 million from the previous level of 23.40 million. Shares recently traded at $110.83 in a 52-week range of $85.82 to $119.33.

Citigroup Inc. (NYSE: C) short interest decreased to 19.49 million from the previous level of 23.62 million. Shares were trading at $68.11 in a 52-week range of $63.16 to $80.70.

Wells Fargo & Co. (NYSE: WFC) short interest grew to 43.99 million shares from the previous reading of 35.55 million. Shares were trading at $55.51 within a 52-week range of $49.27 to $66.31.

Short interest in Goldman Sachs Group Inc. (NYSE: GS) decreased to 5.18 million shares from the previous 5.39 million. The stock recently traded at $234.09 within a 52-week range of $214.64 to $275.31.

Morgan Stanley’s (NYSE: MS) short interest for this settlement date was 10.11 million shares, down from the previous 14.97 million. Shares were changing hands at $51.78 in a 52-week range of $43.48 to $59.38.

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