Iqbal, Javed and Farooqi, Faraz Ahmed (2011): Stock price reaction to earnings announcement: the case of an emerging market.
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In an efficient stock market stock prices instantaneously and accurately adjust to new information. This paper conducts an event study analysis on an emerging market namely the Karachi Stock Exchange (KSE) by investigating the stock price reaction to public announcement of quarterly after tax profit by listed firms. By employing 5 year data on stock prices from January 2004 to August 2008 for 114 non financial firms we found that there is no abnormal return post earnings announcement. Moreover the study provides evidence that there is a bigger element of surprise in bad news than in good news as the market reaction to bad news is stronger.
|Item Type:||MPRA Paper|
|Original Title:||Stock price reaction to earnings announcement: the case of an emerging market|
|English Title:||Stock Price Reaction to Earnings Announcement: The Case of an Emerging Market|
|Keywords:||Event Study, Earnings Announcement, Emerging Markets|
|Subjects:||G - Financial Economics > G1 - General Financial Markets > G14 - Information and Market Efficiency ; Event Studies ; Insider Trading|
|Depositing User:||Javed Iqbal|
|Date Deposited:||11. May 2011 14:36|
|Last Modified:||13. Feb 2013 16:55|
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