Whether or not the Nokia-Microsoft deal makes any economic sense is up for analysts to argue but judging by the market's reaction to MSFT this morning, we'd say 'not' as the stocks is down almost 5% (devouring the entire Ballmer-bounce). However, Nokia is up a stunning 41% as investors seem not just relieved at the firm's dumping of the loss-making mobile business (always a greater fool?) for $7.2 billion; but concerned at the massive short-interest in the name. While the absolute number of shares short has dropped in recent weeks, it remains high at 11.9% of float (according to Markit); but in terms of days-to-cover it has never been higher and in fact will take around 15 days at average volume to unwind fund's massive short positions.
Nokia up 41%, MSFT -5%...
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with Nokia's Short Interest extremely high...
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And while there was much jubilation when Ballmer quit, that has all but faded as the CEO drops this inexplicable bomb on his way out. Maybe for the benefit of all the MSFT bulls, he can quit once more?
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Charts:Bloomberg