The New York Stock Exchange said margin debt fell 3% in June,
the second straight decline after eight months of increases.
At the end of June margin debt totaled $305.89 billion,
retreating from May's $315.38 billion. April's level of $320.71
billion was the highest level since February 2008, according to Big
Board data for customers of NYSE-member securities firms.
Market analysts track margin-debt activity as a signal of
investors' appetite for speculative trading.
Those trading "on margin" take on a risk in exposing themselves
to margin calls during a sharp decline in stock prices, which
require them to post additional collateral lest their brokers sell
their securities to cover the debt. A wave of margin calls can
worsen selling pressure on stocks, a phenomenon that some say
contributed to the market's plummet during the financial
crisis.
The New York Stock Exchange is part of NYSE Euronext (NYX).
-By Lauren Pollock, Dow Jones Newswires; 212-416-2356; lauren.pollock@dowjones.com