BUZZ-Lloyds: delay of block placing keeping shorts at bay

** Decision to extend trading facility to run off UK government's Lloyds stake rather than using a block placing keeping hedge funds looking to short the stock at bay, according to traders

** Reuters reported on Friday UKFI looking to extend June 30 deadline for "dribble out" carried out by Morgan Stanley (Xetra: 885836 - news)

** Shares (Frankfurt: DI6.F - news) just off post-crisis highs at 88p, giving breathing room from govt's 73.6p buy-in price. Chart: http://link.reuters.com/naq74w

** Some attempts from hedge funds to short stock on strength post-results and post-UK election, but outweighed by considerable long only buying, according to a trader at a broker among the most active in the stock in the last week

** Appetite to short stock likely to diminish if block placing in next few months becomes unlikely

** UK institutions still heavily underweight stock, according to traders: UK active managers still play relatively small role on top ten owners' sheet despite supply. Chart: http://link.reuters.com/paq74w (RM (LSE: RM.L - news) : alasdair.pal.thomsonreuters.com@reuters.net)