Thailand temporarily banned short selling in response to market turmoil

Thailand has announced temporary intervention to ban short selling of most securities and tighten several trading mechanisms in a bid to stem further market falls and stabilise investor expectations as global financial markets convulsed by massive US tariffs.

Bloomberg reported that the board of directors of the Stock Exchange of Thailand held a special meeting on Monday (April 7), and decided that from Tuesday (8), other market participants (such as ordinary investors, institutional investors, etc.) except for "market makers" who are responsible for providing liquidity to the market are temporarily banned from short selling. At the same time, the Stock Exchange of Thailand will reduce the intraday limit on the price of stocks and derivatives to limit wild price movements.

The measure will remain in place until April 11. It was a public holiday in Thailand and financial markets were closed.

The exchange pointed out that the restriction measures are aimed at easing the abnormal volatility caused by external shocks in the short term, and provide time for investors to re-evaluate the impact and prospects of the US tariff policy.

According to the previously announced tariff plan, Thailand is included in the list of high-tax countries, with a tariff level of up to 36%, which is at the forefront of Southeast Asia. Last year, Thailand's trade surplus with the United States reached $45 billion, making it one of the countries most affected by the trade friction.

Before the shock, the Thai market was already showing signs of weakness, with continued investor outflows weighed on stocks amid declining corporate profitability and an uncertain economic outlook. Thailand's main stock market index (SET) fell 4.3 percent last week and is down nearly 20 percent for the year, a five-year low.

The exchange stressed that the timely adoption of counter-cyclical regulatory tools will help restore market confidence and prevent investor panic from further amplifying systemic risks.