MILAN/MADRID: Italy and Spain imposed trading curbs on stock markets, banning short-selling of dozens of stocks, to stem a market rout triggered by the coronavirus outbreak that saw European stock exchanges post their worst-ever daily losses.
The ban will put hedge funds and other investors on high alert for similar moves elsewhere, as governments grapple with a disease that has infected tens of thousands, threatening further deaths and hurting businesses globally.
Italy and Spain made the move as alarm over coronavirus intensified and sent stock markets into a tailspin.
Other countries were hesitant. Germany said it was not planning a ban, while France, which has yet to act, said it had not observed a particular spike in short-selling so far. The Dutch financial watchdog said it saw no reason for a ban.
On Thursday, Italy had seen stocks slide 17 per cent, leading a dive across major European markets, which had their biggest daily losses on record. Spain’s IBEX-35 index dropped 14 per cent on the day. A package of measures by the European Central Bank did little to calm nerves.
The disease has infected more than 127,000 people worldwide, caused public life in Italy to grind to a halt, prompted Spain to place four towns under quarantine and shut down schools and universities.
Spain’s regulator said the ban would apply to 69 stocks, including all liquid shares whose price fell more than 10 per cent on Thursday, and all illiquid shares that fell by more than 20 per cent. In Italy the ban will apply to 85 stocks. — Reuters
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