Short Interest in S&P 500 Stocks Declines to 2.3% in July, Remains Above Long-Term Average

Short interest for the median S&P 500 stock declined to 2.3% at the end of July, down from 2.4% in June. However, it remains above the long-term average and in the 96th percentile since 1995. Goldman Sachs highlights stocks with the largest increases in short interest in the third quarter.

Short interest for the median S&P 500 stock declined to 2.3% at the end of July, a decrease from 2.4% in June. This reduction, however, still places the median stock in the 96th percentile since 1995, according to data from Goldman Sachs [2].

The decline in short interest is notable but does not indicate a significant shift in overall market sentiment. Goldman Sachs analysts, led by senior equity strategist Ben Snider, have identified several large-cap stocks with elevated short interest that have seen increases since the start of the third quarter. These stocks include SailPoint, Inc. (SAIL), Domino's Pizza, Inc. (PDZ), Westlake (WLK), and Summit Therapeutics Inc. (SMMT), among others [2].

The technology sector, which holds the highest weightage on the S&P 500 index, saw a notable decline in short interest in July, decreasing to 1.77% from 1.89% in June. This reduction suggests a more favorable outlook for the sector, although investors should remain vigilant and monitor key metrics for companies like MeridianLink, which reported mixed earnings in July [3].

The reduction in short interest across the technology sector can be attributed to several factors, including the sector's strong performance in 2025, with a year-to-date growth of over 15%, compared to the broader S&P 500's growth of over 9% [3].

Overall, while the decrease in short interest is encouraging, investors should continue to monitor key metrics and maintain a cautious approach.

References:
[1] https://www.ainvest.com/news/500-tech-sector-sees-short-sellers-reduce-bets-july-2508-99/
[2] https://seekingalpha.com/news/4487531-stocks-with-the-largest-increases-in-short-interest-so-far-in-3q-goldman-sachs
[3] https://seekingalpha.com/news/4485594-short-sellers-reduce-bets-against-sp-500-technology-stocks-in-july