Taiwan Bans Short Selling of 150 Key Index Stocks for 2 Weeks

Taiwan Bans Short Selling of 150 Key Index Stocks for 2 Weeks


Sept. 21 (Bloomberg) -- Taiwan's financial regulator placed a ban on the short-selling of 150 stocks for two weeks starting Sept. 22, following similar moves by U.S., U.K. and Canadian regulators.

The 150 stocks, members of the Taiwan 50 Index, Taiwan Mid- Cap 100 and Taiwan Technology Index, will be banned from short- selling when they trade below the previous session's close, the Financial Supervisory Commission staid in a statement today.

``The move is to maintain market order and stability, raise investors confidence and boost the market,'' the regulator said. The halt will start from Sept. 22 and will be in effect until Oct. 3, unless it's further extended, according to the statement.

The U.S. Securities and Exchange Commission halted the short selling of 799 financial companies in a move to combat investors seeking to drive down shares following the collapse of Lehman Brothers Holdings Inc. and the bailout of American International Group Inc.

Short sellers borrow stocks and sell them, betting the price will fall and they'll be able to buy them later, return them to the lender, and pocket the difference in price.

BLOOMBERG