Instead the restrictions, which prevent investors from selling stocks they have borrowed and do not own, have reduced volumes and liquidity, according to research commissioned by the International Securities Lending Association, the Alternative Investment Management Association and the London Investment Banking Association.

David Rule, chief executive of the ISLA, said: “The research shows no obvious effect on the way that share prices have moved. The markets have behaved in the same way as they would have without the ban, with the markets worried about the economy and company earnings. What we have seen is wider bid-offer spreads because of less liquidity.”

Ian Harnett, European equities strategist at Absolute Strategy Research, agreed: “What we can say is that the markets have found their own fundamental levels with economic activity weakening and companies losing profitability.”