Short-selling ban boosts European bourses
European stock markets saw a timid recovery on Friday after France, Italy, Belgium and Spain banned short-selling of some stocks for two weeks. The Paris bourse recovered during the morning after falling at the beginning of the day thanks to the announcement of disappointing growth figures.
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Stocks in Britain, Belgium, Germany and Italy showed rises of less than one per cent early Thursday after dipping when trading opened.
The rise followed the announcement that four countries had stopped the speculative practice of short-selling, in which investors bet that share prices will fall. The European Securities and Markets Authority said that “false rumours” have destabilised the markets.
The move came after French regulators blamed Wednesday’s plunge in Paris, which saw banking giant Société Générale’s shares tumble nearly 15 per cent, blamed unfounded rumours and implied that they were spread by speculators.
Latest figures show the French economy performing worse than expected, with no growth in the second quarter reversing the rise of the 0.9 per cent first. On Monday the Bank of France predicted 0.2 per cent growth.
Economy Minister François Baroin insisted that the country is on target for two per cent growth for the full year.
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