French stock market regulators are investigating unusual share price movements in France Telecom and other CAC-40 blue chips, amid concerns that unknown market players could be profiteering on a wave of rumour and speculation.
The move comes as regulators in other countries voice concerns over the potential for market abuse in buoyant takeover markets. A study by the Financial Services Authority, the UK watchdog, estimated that questionable share price movements ahead of bids were as prevalent as in 2000.
France Telecom asked the AMF, France’s stock market regulator, to investigate a sudden 3 per cent drop in its share price last Tuesday after false rumours circulated that it would abandon performance objectives set only three weeks earlier.
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