(New York)

Don’t be fooled by this rally. Many research analysts, including those at Citi, say that this big rise in markets is not being driven by bulls, but by bears. One of the odd parts of these gains has been that money has been continuously flowing out of equity funds since March, but prices have risen despite that. The reason why may be that instead of bulls buying stocks, the gains have been driven by short-sellers buying back short positions they opened at the start of COVID.

FINSUM: This is good, simple analysis from Citi. Their additional comment could not have summed it up better: “From here, a move higher will need new longs and inflows”.