From the Securities Lending Trading Desk

car

This week, automotive retailers were in focus as fundamental demand heats up amid speculation recent rallies are overdone and with the listing of CarGurus. We are seeing China’s Great Wall Motor Company Ltd shares hit a two year high following news of a potential joint venture with BMW AG.  Meanwhile in Europe, securities lending demand increases ahead of rights record date for South African investment holding company Stadio Holdings.

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From the Securities Lending Trading Desk

Detail of bridge pylon, Bracebridge, Muskoka, Ontario, Canada

In Europe this week, French steel producer Vallourec issued an EUR 200mm convertible bond. We have seen strong demand for Secoo Holding Ltd (SECO) as their share price plummeted nearly 40% since going public. Meanwhile in Asia, NetDragon Websoft, one of China’s leading developers of online games and mobile applications, turned to the capital markets for funding of an expansion of its overseas education business.

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From the Securities Lending Trading Desk

Ubiquiti Networks Inc. are a greater focus of interest as the share price declined more than 35% after a report from Citron Research accused the company of fraud. Last week, Geely Automobile hit a record high as automakers rallied in Hong Kong on speculation of strong support from Chinese policy makers for the electric vehicle sector. Meanwhile in Europe, we are seeing a substantial stake increase in Anglo American which has given rise to securities lending demand.

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From the Securities Lending Trading Desk

Mobile Phone - Low Battery

We are seeing fundamental demand pick up for Energous Corporation (WATT) after Apple announced their plans for pad-based charging for iPhones and the support of an open wireless charging standard.  Last week, the Italian-based luxury goods manufacturer Prada SpA warned investors that its turnaround plan to reshape its business may take longer than expected.  Montea SCA, the Belgium real estate property developer, announced a EUR 68 million rights issue.

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From the Securities Lending Trading Desk

Green microchip set in a blue printed circuit board

The proposed sale of one of Toshiba Corp’s prized businesses is starting to gain more momentum after months of wrangling between the Japanese conglomerate and one of its key partners in a manufacturing joint venture. We are seeing fee levels climbing higher again for RH as the share price rallied 50% on better than expected second quarter results, squeezing shorts.  Meanwhile in Europe, Liberbank SA is the latest European lender to issue a rights issue in order to clear up its balance sheet.

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From the Securities Lending Trading Desk

Amazon’s acquisition of Whole Foods Market has put grocers directly in the spotlight of short sellers in the US as competition and price-slashing become major headwinds for the sector. We are seeing the South Korean shipbuilding sector show signs of recovery on news that two of its largest firms are poised to win one of the industry’s largest orders in recent years.  French publishing firm Vivendi became a name of focus as funds looked for guaranteed untendered stock in the upcoming tender election.

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From the Securities Lending Trading Desk

Illustration of robots assembling a car

Last week, borrowers sought shares of one of China’s leading automakers after it tempered speculation that it was on the verge of a deal to acquire one of Fiat Chrysler Automobiles’ iconic brands.  There was renewed broker demand for Herbalife Ltd. (HLF) as the stock price surged following their announcement of a modified Dutch auction.  Meanwhile in Europe, reports of accounting fraud sent Steinhoff International lower, spurring borrower interest.

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From the Securities Lending Trading Desk

Modern building with flying airplane

Long term interest continues for Cathay Pacific, after the airline announced its worst half year loss in at least two decades as passenger numbers and fares declined. We are seeing increased directional demand for VMware, Inc. (VMW) as investors question if the share price rally is warranted.  Meanwhile in Europe, borrowers are seeking shares of German Potash miner, K+S, after the firm revised its 2020 profit figure off the back of a challenging price outlook.

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