European Countries Ban Short Selling

First Western ban on practice since Lehman fall
By Matt Cantor,  Newser Staff
Posted Aug 12, 2011 7:24 AM CDT
World Stock Markets: European Stocks Rise Amid Short-Selling Ban
The London Stock Exchange is seen in the City of London, Friday, Aug. 12, 2011.   (AP Photo/Sang Tan)

European markets are up today following the decision by four countries to ban short-selling of some stocks. After stumbling this morning, London’s FTSE 100, Frankfurt’s Dax, and Paris' Cac rose between 1.5% and 2.5%, the BBC reports. The last major Western short-selling ban came in the US and UK after the fall of Lehman Brothers. There are no plans to expand the current temporary bans beyond France, Italy, Spain, and Belgium, said a top European regulator—but he wouldn’t rule it out.

Some weren’t sure that the ban on short selling would do much to help the volatile market situation. “In the short-term," the action "will help calm things down, but if you look at what happened at Lehman during the crisis, it didn't do much,” said an analyst. (Read more European markets stories.)

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