Speculators rush to close short positions in the U.S. stock market
Major speculators unexpectedly and abruptly reduced the rates of decline on the US stock market, which increased along with the same growth of the S&P 500 index. In the week before June 23, hedge funds bought 206,227 net futures contracts for the S&P 500, which was a record high since 2007 and the third largest in history, writes Bloomberg with reference to data from the U.S. Commodity Futures Trading Commission (CFTC).
The S&P 500 stock index rose from the lows of March to the highs of June by almost 50%, while the volume of short speculative position in futures rose to record values for almost 10 years. Bloomberg experts explain the increased bearish sentiment among speculators, which took place in recent months, by the expectations of the second wave of Covid-19.
Deutsche Bank notes that not only hedge funds are buying: according to the bank, recently the positioning of discretionary and system investors are also becoming more bullish.