Wall Street is growing less confident in the technology sector and continues to be negative on retailers, according to the latest data on short selling.
Across the 11 S&P 500 sectors, five saw increases in the amount of available shares that are sold short, a bet that they will decline in value.
The biggest increases were in shares of technology companies, where the average short interest is now at a 52-week high, wrote analysts at Bespoke Investment Group. Consumer discretionary stocks remained popular bets as well. Short interest in the sector, which includes retailers, was the highest in the S&P.
Source: Bespoke Investment Group
In a short sale, a stock is borrowed and then sold with the hope it will decline in value so it can be repurchased later to pay back the loan with a profit. It is a strategy that is popular with hedge funds.
The increased short selling in technology comes on the heels of a historic run for the sector, up more than 30 percent over the past 12 months and nearly 60 percent over the past two years. Chip stocks like Nvidia and Micron are up more than 40 percent over the past year as smartphone producers, computer companies and self-driving visionaries spur demand for semiconductors.
In comparison, the S&P 500 is up 13 percent over the past year and 29 percent over the past two years.
However, the impressive run in tech has some investors worried that the trade may have overshot its true value, with one-fifth of Advanced Micro Devices' available shares sold short.
The technology hardware subsector also hit its highest short interest in a year, at 7.19 percent of available shares, Bespoke added. Drug and biotech stocks were not far behind.
Investors maintained their negative view on retailers. The average short interest as a percentage of shares available for trading was 14.7 percent, Bespoke wrote. That's the highest level for any subsector on the Street, Bespoke added.
The most heavily shorted stock in the S&P 500 was Under Armour, with 36.8 percent of shares sold short, the report said. TripAdvisor was a popular bet, with 19 percent of shares available for trading sold short; Nordstrom and Kohl's short interest hit 14.5 percent and 16 percent, respectively.