Tencent, Alibaba Short Positions Down Over 80% From July Peak; Tech Index Above 4,800
Short-selling in Hong Kong-listed Tencent and Alibaba has retreated sharply from July peaks. By August 6, Tencent's short shares fell 81.8% to 2,029,800 and short value dropped 80.5% to HK$978 million from July 22 highs. Alibaba's short shares plunged 88.9% to 5,655,200 and value declined 86.9% to HK$704 million from July 8 peaks. The Hang Seng Tech Index rose above 4,800 from below 4,700 on July 24, as reduced short pressure improved sentiment, though the market remains rangebound.
Short-selling pressure in the Hong Kong stock market has eased markedly. Both the value and volume of short positions in Tencent Holdings and Alibaba Group have fallen by more than 80% from their July peaks. The broader market continues to trade in a wide range, but from a hedging and positioning perspective, short-selling data show a pattern of building early in the month, peaking mid-month, and retreating broadly in recent sessions.
Tencent's short-selling peaked on July 22, with 11,177,700 shares sold short, valued at HK$5.019 billion. By August 6, short shares had fallen to 2,029,800, down 81.8% from the peak, while the short value narrowed to HK$978 million, a decline of 80.5%. The accelerated exit of short sellers has eased downward pressure on Tencent's share price.
Alibaba's short positions also showed aggressive covering. On July 8, Alibaba's short shares surged to 51,140,900, with a short value of HK$5.36 billion, a monthly high. Subsequently, short selling dried up rapidly. By August 6, short shares had fallen to 5,655,200, down 88.9%, and the short value narrowed to HK$704 million, a plunge of 86.9% from the peak.
The Hang Seng Tech Index has risen from below 4,700 on July 24 to above 4,800 currently. While the overall market remains rangebound, the decline in short-selling data has improved sentiment, though the trend will depend on subsequent market performance.