UK stocks up on short-sale ban
UK investors were buoyed not only by news of the U.S. Treasury's plan to set up a new institution for toxic debt, but also by their country's ban on short selling. Megan Williams looks into the turnaround.
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TEXT OF STORY
Stacey Vanek-Smith: Also helping the footsie, yesterday Britain banned short selling and, of course, they're liking that Paulson plan. Megan Williams has more.
Megan Williams: The U.S. Treasury Secretary's proposal to shift risky assets from finance companies to a new institution triggered a happy turn-around for the European stock market. After a four-day slide downhill brought on by the collapse of Lehman Brothers, European shares rose today. Deutsche Bank and Credit Suisse are both up 15 percent.
Lawrence Peterman: Completely different from yesterday evening from when we went home to this morning. Two bits of very positive news.
Investment director Lawrence Peterman said the UK three-month ban on short selling, where traders profit from falling shares, was also key in fuelling the British rebound.
Peterman: Well, yesterday afternoon, the London market came off very sharply, it was very weak, but it's totally changed over night with news coming out of the States with this potential rescue fund, plus the FSA over here removing that ability to short sell.
What's also different from yesterday, says Peterman, is that this solution feels longer-term.
I'm Megan Williams for Marketplace.
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