The Financial Supervisory Commission (FSC) has banned the short selling of stocks below the closing prices of the previous session. The goal is to help stabilize Taiwan’s equity market. The FSC made the announcement on Sunday, saying that it would go into effect on Monday.
The move is in response to the Dow Jones, which fell by 530 points on Friday, bringing it to its lowest closing number since last October.
The FSC says that even though the new measure could have an impact on trade volume, it’s important not to underestimate the impact of losses in the US stock market on the bourse here in Taiwan. Officials say that once the market recovers, it will consider lifting the ban.