The electric vehicle (EV) manufacturer BYD Co (SZ:002594). witnessed an increase in bearish trading activity leading up to the European Union's announcement of an investigation into Chinese subsidies for eco-friendly cars. This is according to data published on Thursday, September 14, 2023, by IHS Markit Ltd., which highlights a surge in short interest in BYD that hasn't been observed since November 2021.
As of Tuesday, approximately 4.4% of BYD's outstanding shares were held in short positions, making it the second-most-shorted stock on the Hang Seng China Enterprises Index. The only company surpassing BYD in this regard is XPeng Inc (NYSE:XPEV)., with 5.2% of its shares being shorted.
Thursday saw a drop in BYD's Hong Kong-listed shares, which plummeted by as much as 3.8%. This decline coincided with the heightened bearish activity and comes at a time when BYD is already dealing with potential implications stemming from the EU's investigation into China's clean car subsidies.
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