News.com.au – Kim Ivey, chairman of the Australian arm of the Alternative Investment Management Association said Australian banks no longer needed further government protection.

He said the ban was damaging market liquidity and denying investors the ability to protect their capital in falling markets.

"The situation has reached a stage where this extension of the short-selling ban will have severe and immutable long-term effects," said Mr Ivey.

"The markets are in disequilibrium – they are lurching all over the place because there is a vacuum of buying."

The Australian Securities and Investments Commission yesterday extended the ban on covered short-selling for non-financial stocks until November 19, but said a ban on shorting financial stocks would continue until January 27.

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ninemsn – The corporations watchdog has extended a ban on covered short selling in the local equities market by at least another month because market conditions continue to be difficult.

But a group representing hedge funds, which are high volume users of the short selling trading technique, has condemned the move, saying it could lead to job losses.

The Australian Securities and Investments Commission (ASIC) imposed the ban on September 21, as financial markets were racked by volatility and regulators began to look for ways to reduce wild swing in certain shares and the wider market.

ASIC chairman Tony D’Aloisio said on Tuesday that various actions and packages adopted by the Australian and other world governments to address the global financial crisis were yet to work through the system.

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Financial Standard – The hedge fund industry has condemned the Australian Securities and Investments Commission’s (ASIC) decision to extend the ban on short selling on non-financial stocks, declaring it will have "severe and immutable long-term effects".

ASIC extended the ban on short selling for non-financial stocks by another 28 days to November 18. Although the ban has been extended, ASIC expects to lift the ban as of the next day’s trading but it would largely depend on the "state of the markets".

The short selling ban on financial stocks will continue until January 27, 2009.

ASIC maintained that while the US had lifted its bans, UK and others are sustaining the ban.

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