Italy bans stock short-selling as market plunges 8:31 a.m. Monday, July 23, 2012 The Associated Press MILAN â Italy's financial markets watchdog on Monday imposed a ban on the short-selling of shares as the Milan stock index plunged amid fears over the country's financial stability. European shares extended their losses on Monday as a move by Spain to ban short-selling on all Spanish securities raised fears that the region's sovereign debt and banking crisis may be worse than expected. http://uk.reuters.com/article/2012/07/23/markets-europe-stocks-fall-idUKL6E8INBDD20120723
There still has to be buyers to bring the prices higher. I really don't think short sellers have much if any influence on the long term price performance of markets.