Four EU nations ban short-selling on banking stocks

13/08/2011  

French banking shares have been most affected by the recent market turbulence France, Italy, Spain and Belgium have banned short-selling of the shares of banks and other financial companies. It follows sharp gains and losses in bank stocks in recent days, especially in France, on the level of their exposure to eurozone government debt. Societe Generale has been the worst affected by the volatility, being forced on Wednesday to deny that its financial stability was at risk. Short-selling is when traders profit from bets on the fall in a share price. It has been blamed for increasing recent market instability. Short-sellers usually borrow shares or bonds, sell them, then buy them back when the stock falls - pocketing the difference. "Naked" short-selling is when a trader sells fi

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