TIM Report: Brokers Step Up Profit Taking

by: David Enke

According to the recent TIM (Trade Ideas Monitor) report, the TIM Sentiment Index (TSI) fell into bearish territory as it decreased 2.4% week over week to 49.84 on July 30th, from 51.06 on July 23rd (see last week's post, and previous post and the youDevise website for additional information on the TIM report). Nonetheless, the index increased 9.3% on Thursday.

New short ideas as a percentage of all new ideas sent to investment managers increased from 28.26% a week ago to 46.92% on Tuesday, then back to 33.19%. Shorts are 36.72% of ideas in July and 40.95% for the year. As result, the index is indicating that while brokers are generally bullish with their new ideas, they have increased their profit taking as the market continues to rise.

As for individual securities in the U.S. and North America, Viacom (NYSE:VIA), GSI Commerce (NASDAQ:GSIC), and Adtran (NASDAQ:ADTN) were stocks recommended as longs by institutional brokers, while Cymer (NASDAQ:CYMI), Saks (NYSE:SKS), and Priceline (PCLN) were recommended as shorts. The industrials, financials, and consumer staples sectors had long broker sentiment for the week, while the utility, energy, and information technology sectors had short sentiment.