New York – The Securities and Exchange Commission temporarily banned short-selling on 799 financial stocks to boost investor confidence on Friday, one day after the UK Financial Services Authority took a similar step.
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“The Commission is committed to using every weapon in its arsenal to combat market manipulation that threatens investors and capital markets,” SEC Chairman Christopher Cox said in a statement.
“This action, which would not be necessary in a well-functioning market, is temporary in nature and part of the comprehensive set of steps being taken by the Federal Reserve, the Treasury, and the Congress,” Cox said.
The SEC’s emergency order will be effective immediately and will terminate at 11:59 p.m. New York time on October 2, 2008, the Commission said in a statement.
The order may be extended beyond 10 days if the SEC deems an extension necessary in the public interest and for the protection of investors, but the order will not be extended for more than 30 calendar days in total duration, it said.
“Today’s decisive SEC action calls a time-out to aggressive short selling in financial institution stocks, because of the essential link between their stock price and confidence in the institution,” the statement said.
“The Commission will continue to consider measures to address short selling concerns in other publicly traded companies,” it added.
The decision is positive for stocks, analysts said.
exellent move. This should have stoped awhile back before Bear Sterns. In europe and england it was stoped long ago. lets hope this will stabilize the markets
in the UK it was stopped yesterday, not a long time ago. it’s a good move- but the shorts will be burnt too as a result. now should be a good time to enter the market, though I don’t see how the SEC will be able to control offshore traders.
AIG & Morgan Stanley (MS) up 50%!
As I told you guys….
Dont Panic…
Lock & Load
dont invest yet. wait till the market has settled and has stopped reacting to every little glimmer of hope. Otherwise you could be the next on the line for Fed bailout
Vehachai ten es liboi…