Shorting ban to have little impact on German stocks: Managers

Investors in German equities do not expect the country's short selling ban on financials to have any material long-term effect on the country's stock market.

Overnight, the German regulator Bafin vetoed local investors from naked shorting 10 German banks and insurers and protection for eurozone sovereigns. The decision has spooked the equity markets today, sending the benchmark Dax index down 2.6% by noon London time. Bafin's says the ban, which lasts until 31 March, is due to "exceptional volatility" in bond markets. The yield on the two-year bund plunged from 1.4% at the start of this year to 0.45% on 7 May, before rising to 0.51% now. While the bond markets have been volatile, Dataexplorers says shorting of the 10 financial stocks si...