Brokerages temporarily suspend short selling
Print Edition
FIVE Chinese brokerages yesterday suspended their short selling services, a day after the securities regulator announced tighter rules on such trades in the latest bid to shore up the stock market.
The country’s top-three brokerages: CITIC Securities, Guosen Securities and Huatai Securities all said they would halt their services temporarily. Smaller peers Great Wall Securities and Qilu Securities soon followed suit.
“We’re temporarily halting short selling from today in order to comply with urgent changes in exchange rules and control business risks,” CITIC said in a statement to its clients.
The Shanghai and Shenzhen exchanges said in separate statements on Monday night that new rules, effective immediately, banned traders from borrowing and repaying stocks on the same day.
In short selling, investors borrow shares from brokerages and then sells them, betting that the price drops so they can be bought back at a lower price.
However, under the new rules, short sellers will be unable to complete trades on the same day, which makes the proposition more risky.
The rule change was designed to “prevent some investors from using same-day short selling to amplify abnormal fluctuations in stock prices and affect market stability,” the Shenzhen Stock Exchange said in a statement on its website.
The move is the latest by the government to bolster the stock market, after the key Shanghai Composite Index fell 30 percent from its mid-June peak.
The China Securities Regulatory Commission said earlier that it was looking for evidence of “malicious short selling” and had suspended 34 stock accounts for suspected trading irregularities.
- About Us
- |
- Terms of Use
- |
-
RSS - |
- Privacy Policy
- |
- Contact Us
- |
- Shanghai Call Center: 962288
- |
- Tip-off hotline: 52920043
- 沪ICP证：沪ICP备05050403号-1
- |
- 互联网新闻信息服务许可证：31120180004
- |
- 网络视听许可证：0909346
- |
- 广播电视节目制作许可证：沪字第354号
- |
- 增值电信业务经营许可证：沪B2-20120012
Copyright © 1999- Shanghai Daily. All rights reserved.Preferably viewed with Internet Explorer 8 or newer browsers.
