The Securities and Exchange Board of India is watching trends in the domestic stock market, after the capital market regulators in the United States, the United Kingdom and Australia imposed a temporary ban on short-selling of financial stocks.
A top Sebi official said, "We are assessing the current market situation and closely monitoring the trading pattern. We will wait for a couple of more days before taking any decision."
Before a sharp recovery on Friday, the domestic benchmarks fell over 10 per cent in four trading sessions on the back of massive short selling.
The share of the largest private sector bank, ICICI Bank, was hammered on news of its high debt exposure to Lehman Brothers. The stock fell over 20 per cent this week and touched a 52-week low of Rs 515 on the Bombay Stock Exchange on September 16.
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