Trade tensions between China and the U.S. are once again on the rise over President Donald Trump’s threats to ban TikTok and WeChat in the U.S. starting on Sunday. With the November election now only about six weeks away, S3 Partners analyst Ihor Dusaniwsky said short sellers are targeting Chinese stocks in a major way.
Dusaniwsky said China and Hong Kong short interest now totals $104 billion, an increase of $2.03 billion in the past month. The dispute between Trump and China over TikTok could be a preview of what’s to come between now and the election, and short sellers seem to believe Chinese stocks could suffer.
Short sellers have been particularly aggressive in betting against Alibaba and JD.com in the past 30 days. Alibaba’s short interest has increased by $1.48 billion in that time, while JD.com’s short interest is up by $320.7 million. Nio’s short interest is headed in the other direction, dropping by $642.5 million in the past month.
LKNCY), which has netted short sellers a $1.15 billion profit this year. However, short sellers have taken year-to-date losses of $2.51 billion on Alibaba, $2.45 billion on GSX Techedu and $1.77 billion on Nio.
“HK-China short sellers are down -$15.98 billion in mark-to-market losses for the year but are up +$935 million in September mark-to-market profits as the Hang Seng retreated -1.79%,” Dusaniwsky said.
to PredictIt, Joe Biden now has a 59% chance of defeating Trump in November. Given Trump has been extremely tough on China throughout his first term, any momentum Biden has leading into the election would presumably be bad news for Chinese stock short sellers.” data-reactid=”35″>Benzinga’s Take: According to PredictIt, Joe Biden now has a 59% chance of defeating Trump in November. Given Trump has been extremely tough on China throughout his first term, any momentum Biden has leading into the election would presumably be bad news for Chinese stock short sellers.
Why Trump’s TikTok Ban Could Be ‘Fort Sumter Moment’ In Cold Tech War Between US, China ” data-reactid=”37″>Why Trump’s TikTok Ban Could Be ‘Fort Sumter Moment’ In Cold Tech War Between US, China
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