Short Sellers Prowling for Banks, Solar Stocks

Emerging markets shares, financials and solar stocks remain the top stocks sought by short sellers in the past week, according to

John Tabacco, chief executive of Locatestock, said the stock that short sellers have been most willing to pay a premium to locate is LDK Solar , followed by Blue Nile and Arthrocare .

"The solar names are still being hit, and while there was some covering in SPWR (SunPower ), in the last week CSIQ (Canadian Solar ) continues to be a target," he said. "I think the solars are experiencing a squeeze, but the rug could get pulled out of it if oil comes off these highs in any substantial way."

"One to watch that has been gaining momentum in price and short requests is DRYS (DryShips )," Tabacco said. The stock is in the top 10 of stocks being sought by shorts.

The top five stocks sought in the week ended Wednesday were:

  • Lehman (1.88 million shares)
  • General Motors (1.68 million shares)
  • Canadian Solar (909,000 shares)
  • iShares MSCI Emerging Markets Index (889,600 shares)
  • iShares FTSE/Xinhua China 24 Index (812,000 shares)

Tabacco's firm locates stock for short sellers, who are required to have access to shares they short. That does not mean those stocks will definitely become popular shorts.

Volume at Locatestock in the past week averaged 301.2 million, a slight increase over the week earlier—and a sign that the shorts aren't giving up, Tabacco said.

See what the shorts were looking for last week by checking sought-after short stocks from last week and short stocks from the week before that.

Questions? Comments?