Short interest data from mid-January showed that short sellers moved out of big tech stocks, a sign that the market has warmed to a sector about which it has been ambivalent.

Shares sold short in Intel Corp. (NASDAQ: INTC) dropped 1.6 million to 213.4 million. It would take six days of trading in Intel shares to cover that amount. Intel’s recent earnings were short of spectacular, but showed the firm had not been as badly battered by falling PC sales as expected.

Shares sold short in Microsoft Corp. (NASDAQ: MSFT) fell by 3.2 million to 69.6 million. Days of trading needed to cover this are only two. Microsoft posted much better than expected earnings, and its share price rallied recently. Perhaps short sellers anticipated improvement in Microsoft’s hardware initiatives.

Short interest in eBay Inc. (NASDAQ: EBAY) fell 2.9 million, which would take one day to cover. The retreat was just ahead of Carl Icahn’s push to break off PayPal from its parent, a move that the activist investor believes will make Wall Street take more notice of the payment system’s growth and margins. Total shares sold short in eBay were 17.4 million.

Ahead of earnings that Wall Street worries will be flat, Yahoo! Inc.’s (NASDAQ: YHOO) short interest dropped sharply, down 2.5 million to 30 million, at only two days to cover. While Yahoo!’s stock price has soared, many investors believe this is primarily because of its holdings in Asia, particularly in Alibaba. However, even a modest improvement in Yahoo!’s display advertising would lead many skeptics to believe it has started to solve problems in its core business.

Running against the tide of improvement were several Web 2.0 companies. First among these was Facebook Inc. (NASDAQ: FB), which has become one of the most widely traded stocks on either the Nasdaq or NYSE. Shares in Facebook have sold off recently due to concern that its user base improvement has started to slow. Shares short in Facebook rose 2.3 million to 44 million. The short interest in Zynga Inc. (NASDAQ: ZNGA) rose 3.2 million to 37.4 million.

Finally, shares sold short in the most shorted stock on the Nasdaq plunged. The short interest in Sirius XM Holdings Inc. (NASDAQ: SIRI) dropped 48.1 million to 221.6 million. Its largest shareholder, Liberty Media, is trying to take over the balance of Sirius’s stock.

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