Short sellers betting against US stocks rack up $120 billion in losses

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Short sellers have lost $120 billion betting against the US stock market that's been powered by the AI boom

Short sellers betting against US stocks have taken a major hit this year thanks to a sizzling rally powered by the investor frenzy over artificial intelligence.

The year-to-date surge in equities has led to about $120 billion in mark-to-market losses for short sellers, with $72 billion of it stemming in the first half of June alone,Short selling, also known as shorting, refers to investors borrowing stock to sell with the goal of buying it back later at a lower price and returning it to the lender, pocketing a profit. Traders engage in short selling when they expect a company's stock price to decline, and want to make money if that happens.

The bearish sentiment among some investors stems from concerns the rally is too narrowly focused on technology stocks, given Big Tech companies have largely driven S&P 500 gains this year, and that some shares may be overvalued.While stocks have been on upward trajectory so far this year, top market commentators have warned the rally isn't set to last and could face a

 

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