Sebi’s ban on short sales and Sensex up 238 points

The Securities and Exchange Board of India (Sebi) said it is keeping its options open on banning short sales, which a section of brokers believes are responsible for the collapsing stock market. The benchmark Bombay Stock Exchange Sensex fell below 10,000 Friday, the first time since July 2006. Short selling or "shorting" refers to the practice of selling shares that the seller does not own at the time of the sale with the intent of buying it later at a lower price. Short-sellers attempt to profit from expected decline in share prices.

Foreign Institutional Investors (FIIs), under pressure in their home countries, have been selling consistently since September 15, when Lehman Brothers, one of the largest investment banks in the US, filed for bankruptcy. It is very important to protect the market sentiments during the time of collapse. The market has been trading low for last few weeks but today the Sensex ended in green at 10213 points with 238 points up. Nifty is also ended in green at 3123 with 49 points up. Source