SEC temporarily bans short selling on financials

Fri Sep 19, 2008

The U.S. Securities and Exchange Commission this morning issued a temporary ban to prohibit short selling in financial companies. Although it immediately came under attack, the move was a bid to strengthen investor confidence in the market and follows a similar action taken by the U.K.’s Financial Services Authority on Thursday.

The step, along with the government’s pledge this morning to shore up the financial system, led to a big surge in the shares of many embattled financial companies, including Morgan Stanley and Goldman Sachs. Short-sellers scrambled to cover their positions during a triple-witching day, when stock...

ISSN: 2151-1845 / CDC10004H

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