Overnight the Chinese government cracked down on short-selling, unveiling rules that will make it harder for speculators to profit from hourly price changes. CNBC spoke with two analysts about whether the move is a good one for the Chinese markets long term.
Peter Boockvar, chief market analyst at The Lindsey Group, said that Chinese officials have thrown price discovery out the window and have thus “broken the market.”
“Unfortunately after creating the bubble and responding to the downturn, this is a mess they have gotten themselves into,” he said in an interview with CNBC’s “Power Lunch” on Tuesday. “Their main intention here, I think, is to see the margin debt levels fall to a level they are comfortable with, then they’ll eventually walk away, but they’ve destroyed the market.”
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