Investor sentiment toward European retailers has turned more negative, according to a new UBS report analysing market positioning.
The study uses UBS’s proprietary “crowding” metrics to track how many investors are concentrated in specific stocks, either betting on gains (long) or declines (short).
Retail, for the first time this year, has become a “short-crowded” sector, meaning more investors are positioning against it. Within food retail, enthusiasm has faded slightly, though Tesco PLC (LSE:TSCO) remains a popular pick among investors.
Ocado Group PLC (LSE:OCDO) is the most shorted stock in this segment.
Fashion retailers have seen a sharper shift. UBS found increased short positioning against names like H&M and ASOS PLC (LSE:ASC).
Next PLC (LSE:NXT) and Inditex, while still popular among some investors, also saw reduced support.
The report helps investors understand where risk might build up due to overcrowded positions and highlights stocks vulnerable to sharp moves if market sentiment shifts unexpectedly.