Investors desert Babcock & Brown amid confidence crisis

A fall in the Australian company's market cap below a key threshold triggers widespread short-selling, offering further proof of jittery investor sentiment towards the financial sector.

Babcock Brown, the Australia-based financial institution that is best known for its management of infrastructure funds, has become the latest victim of jittery sentiment towards financial institutions and shows how quickly investors are prepared to withdraw their support once they sense trouble.

Like most other financial institutions, Babcock Brown has been under pressure since October last year, but the sell-off gained pace last week when the share price tumbled from A$11.16 a share to A$5.25, resulting in the company losing...

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