Data released by Hazeltree on Wednesday showed that global hedge funds increased their short positions against manufacturing stocks in June. The sector saw 26 companies on the list of top-shorted firms, an increase of three from May. Among the companies targeted by short-sellers were Toyota, Puma, and Canadian Solar. According to Hazeltree, the average proportion of shares borrowed for shorting in this sector rose to 33% during the month.
The increase in short-selling activity followed renewed volatility in the Strait of Hormuz. LSEG data indicated that shipping flows through the waterway fell by more than 90% during peak disruption in June. Tensions increased after U.S. President Donald Trump reimposed a naval blockade on Iranian ports and issued warnings regarding strikes on infrastructure unless negotiations resumed.
Market analysts, including Daniel Coatsworth of AJ Bell, noted that manufacturing firms are particularly sensitive to supply chain disruptions and rising insurance or freight costs. Andrew Simms of Berenberg observed that freight rates have more than doubled on some routes unaffected by the Middle East tensions, such as Shanghai to Los Angeles, due to broader industry stress. The companies named in the report did not provide immediate comment on the data.