Following the carnage on the markets late last week, Australia's corporate watchdog - ASIC - has elected to halt trading on the ASX.
"Hedge funds are an important part of the global and local economy", said Daryl Braithwait, a spokesman for ASIC. "Following sharp unexpected rises in stocks across the board last week and more rises expected today, something had to be done. ASIC has been called a toothless tiger in the past, and this shows that we can be decisive in stemming some of the broad volatility in the market."
The delay in allowing access to the market is to permit hedge funds and other short sellers to find a seller to close out their large short positions outside of the general market.
"We cannot allow these major players in our market to fail" Mr Braithwait opined.
The ASX is expected to reopen some time in Novemeber.
