“The Squeeze Is On”
Dear Rundown Reader,
According to Bloomberg this morning, “the squeeze is on.”
Meaning short sellers are getting burned this year.
It makes sense. The S&P 500 is 1% away from a record high.
But, as Bloomberg also notes, the temptation to short highly volatile single stocks is overwhelming.
Look no further than the continued mass attempts to short Tesla Inc.
But within all this carnage there’s still a good short play to make now and then. And one may be manifesting as we speak.
Today’s Rundown looks at the next chapter in the Comcast, Fox, Sky Network drama and examines if another tempting short sell is manifesting.
Your Rundown for Wednesday, August 8, 2018…
The Stakes Are High For Big Media
As it stands, that’s how much longer we have until we get an answer to who wins the bidding war for Sky Network.
According to Reuters: “Under British takeover rules, Rupert Murdoch’s Fox now has until Sept. 22” to beat Comcast’s current offer. That offer stands at 14.75 pounds per share for Sky, equating to a deal worth $33 billion U.S., the report notes.
Fox’s previous bid for Sky came in at 14 pounds per share.
The bidding war makes sense for both Comcast (NASDAQ: CMCSA) and Fox (NASDAQ: FOXA). Sky has a wealth of news, sports and entertainment media assets. Plus they boast a massive audience in the U.K.
But what does this all mean for you? Or short sellers?
First off, we have a time frame for this action which is good news. That’s premium info for anyone placing a bet on this action.
Plus, it’s likely the winner of Sky will see a nice bump in share value, while the loser sees its stock go on the downswing.
The temptation to short is strong with this one.
The problem is there’s no indication who will win the bidding war. Despite having good intel, many short sellers will still get burned.
Lending more credence to Bloomberg’s claims that “the squeeze” is truly on.
Place your bets folks. At your own risk.
Now, turning to the markets this morning…
Market Rundown for Wed., August 8
S&P 500 futures are up 1.00 at 2,860.
Oil’s down $0.29 to $68.88.
Gold’s up $0.50 to $1,218.
Bitcoin takes a big hit, now going for $6,514 this morning, according to CoinDesk.
We’ll talk again tomorrow.
For the Rundown,