The balance of shares sold short dwindled last week — the final trading week of fiscal 2001.
The balance of short margin positions fell 138.77 billion yen to 1.08 trillion yen, the lowest figure since late October, according to figures compiled by the Tokyo Stock Exchange. The balance of short selling dropped for the third straight week.
Short covering by corporate investors gathered momentum toward the close of the business year.
Having long hedged their equity holdings via short selling, financial institutions unloaded part of them to cover their short positions, brokerage officials said.
The balance of short positions fell visibly for a wide range of issues that sustained heavy short sales in recent months. Among these were Toshiba, Mitsubishi Electric, Sanyo Electric and other consumer electronic issues, along with Mitsubishi Heavy Industries, Sumitomo Chemical and Tokyo Gas.
The balance of shares bought on credit, on the other hand, rose for the third consecutive week. This suggests that an increasing number of investors are beginning to count on high-priced activity in the coming months.
Specifically, the balance of long margin positions stood at 1.19 trillion yen, up 29.55 billion yen from a week earlier.
As a result, the long-short ratio rose to 1.09 from the previous week’s 0.95, exceeding one-to-one parity for the first time in seven weeks.
In volume terms, the balance of short selling fell 167.65 million shares to 1.28 billion shares, while that of margin buying dropped 3.09 million shares to 2.27 billion shares. This indicates a switch in investor preference away from expensive issues toward cheaper, hitherto-neglected issues.
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