Morrisons became the FTSE 100’s most shorted stock last week as bets against its share price increased despite David Potts’ efforts to turn around the retailer’s trading performance.

Figures from financial information specialist Markit show the proportion of Morrisons stock out on loan reached 13.7% on 29 April, up from 12.4% at the beginning of the month.

Morrisons shares are up over 5% since January but the recent uptick in shorting suggests the City is unconvinced it is yet on a turnaround path. One of the primary drivers of the short-selling increase was hedge fund Lone Pine Capital, which increased its short exposure from 0.53% to 0.91% in the last week of April - representing shares currently worth £40m.

The increase helped make Morrisons the FTSE 100’s most shorted stock last week topping supermarket rival Sainsbury’s, though short selling of Sainsbury’s (which was at 18.4% in December) had edged back above Morrisons to 13.9% after the Bank Holiday Weekend.

The rise in short-selling comes as Morrisons announced a 2.9% decline in like-for-like sales over the 13 weeks to 3 May. This was ahead of analysts’ expectations of a 3.0%-3.5% sales fall, but is still significantly down on a weak comparative period in 2014, when like-for-like sales collapsed by 7.1%.

Potts played down expectations Morrisons would see a rapid turnaround under his stewardship, commenting on Thursday (7 May): “I’m not yet fully match fit in terms of my awareness of what is a great offer for Morrisons’ customers, but I know as more days go by I’ll increasingly understand how I can help provide a match-winning assortment.” Potts added the retailer was engaged in a “broad-ranging programme to listen to our customers and find out what they truly value”. Early feedback from customers has seen the supermarket concentrate on availability, store service and cleanliness.

Morrisons has also slashed its SKU count, with the number of lines down by over 8% year on year to 21,650.

Potts has also continued to shake up Morrisons senior leadership team, with former Asda executive Darren Blackhurst this week becoming his latest high-profile hire. Blackhurst joins from a similar role at B&Q to become group commercial director and replaces Casper Meijer, who left Morrisons last month. Potts said Blackhurst had a “strong track record of providing a good value-focused offer in fresh food and groceries”.

Commenting on Morrisons’ latest results this week, Shore Capital analyst Clive Black said: “Against demonstrably favourable contexts, these cannot be characterised as anything but disappointing trading figures.”