FSA chairman Howard Davies has announced that the regulator is to consult on the controversial practice of short selling in early October.
Short selling, the practice of selling shares that you do not own, has been blamed for contributing to the slide in the markets.
Speaking in Manchester this morning, Davies said: “I should make it clear that we see no case for any outright ban on short selling, a practice which we judge a necessary and desirable underpinning to the liquidity of the London market. However, this is not to argue that UK practice must be left exactly as it is. We will bring forward proposals in early October.”