Howard Davies, chairman of the UK Financial Services Authority (FSA), has called for greater disclosure of short-selling in the equity markets amid concern among some corporates and fund managers that the practice is exacerbating market volatility.

The FSA is planning to launch a consultation process with the UK market in September to examine the options for tighter regulation and greater disclosure. This process will start with a round table of fund managers, trade associations, corporates, hedge funds and prime brokers.