EU regulators clamp down

It's been a week of clamp-down by the financial regulators in Europe. And it's been rotten news for the markets.

It's been a busy week for financial regulators in Europe. Germany rattled the markets on Wednesday by slapping a ban on naked short selling, while EU finance ministers approved draft rules clamping down on hedge funds and private equity. The new rules could have a "terrible effect" on London, said Philip Keevil of Compass Advisers. According to the FSA, Britain is home to 80% of Europe's hedge funds and 60% of its private-equity managers. Outnumbered by his colleagues, Chancellor George Osborne refrained from fighting a last-ditch battle, saying that there was "still much to play for" before the rules are due to be finalised in July.

What the commentators said

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