A note via JP Morgan says less short selling, combined with short covering, has been a factor fuelling the run for stocks, a “steady flow of support”.
JPM nominate one support for the US equity market over the past 12 months has originated from a fall in short interest on the two biggest equity ETFs, the SPDR S&P 500 ETF Trust (SPY) and the Invesco QQQ Trust (these track the S&P 500 and the Nasdaq-100 index, respectively).
- short interest has been declining in a rather steady manner since Q2 2023
Also point to short positions being gradually covered.
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Hmmmm.
