Boursa: Halt on short selling if a stock falls below its previous close

The Kuwait Stock Exchange announced an update to its rulebook to introduce a new condition for halting short selling of a security, as part of amendments to Article (9-32-3). The amendment adds a new provision allowing the Exchange to suspend short selling of a security if its price falls below the previous day’s closing price by a percentage determined by the Exchange. This triggers an automatic suspension of short selling for that security until the end of the trading session, with short selling resuming from the next trading session.

This new condition complements the existing ones stipulated in the Article, which include reaching the maximum allowable percentage for short selling, a decline in stock market indices toward the level specified in Article (9-26-2) of the Exchange’s rules, as well as other circumstances the Exchange deems necessary to ensure market fairness and efficiency.

The rules also allow for the suspension of a broker upon request from the Clearing Agency, in cases permitted under the Clearing Agency’s regulations.