Search results

This study aims to investigate the market reaction in the cyclical consumer sector to the US–Houthi conflict. Furthermore, the authors explore the impact of this conflict on market reactions by market and region.

Using an event study methodology, this paper analyze a sample of 1,973 companies. This paper used multiple event windows, including a 15-day period before the invasion announcement as the preinvasion event and a 15-day period after the invasion announcement as the postinvasion event.

The authors find that pre the event of war, the market tended to show a positive reaction, but toward the event day until post event, the market in the consumer cyclical sector actually reacted significantly negatively to the conflict, especially in developed and developing markets. The Asia and Pacific market is the market that feels the most negative impact from the US–Houthi conflict compared to other markets. Furthermore, in terms of industry types in the consumer staples sector, Food and Tobacco and Personal and Household Products and Services felt the negative impact, although the majority of all industries reacted significantly negatively.

This study focuses on the US–Houthi conflict, an event that has not been extensively studied in the context of market reactions. Unlike previous research, this study specifically examines the impact of the conflict on the consumer cyclical sector, emphasizing the significance of trade route disruptions, particularly the Suez Canal, on global markets. By providing insights into how such geopolitical events affect different regions and industries, this study offers valuable guidance for policymakers and managers in mitigating the adverse effects of geopolitical risks on market stability.

This study aims to examine market reactions to the Israel–Hamas conflict in neighboring countries, particularly focusing on the Middle East North Africa (MENA) region.

The study adopts an event study methodology, employing average abnormal return (AAR) and cumulative abnormal return as measures to assess market reactions. The sample for this study comprises 1,314 companies, with October 9, 2023, identified as the event day for analysis.

The results of our study indicate that countries in close proximity to Israel and Palestine encountered detrimental effects on their capital markets, as evidenced by negative responses observed across various sectors. Our analysis also reveals that countries in the midst of conflict, particularly Israel, experienced a decrease in their stock markets across various sectors, with the exception of materials and real estate. In addition, our investigation reveals disparities in market responses according to different categories of company size.

This research is the first to study market reactions to Israel–Hamas in the MENA region at the company level.

This study aims to investigate the market reaction to dividend announcements in five ASEAN countries during the COVID-19 pandemic. We focus on sectors that are less vulnerable during the COVID-19 pandemic, such as communication services, consumer staples, healthcare and information technology.

A sample of 5,648 dividend announcements from listed companies is utilized for this study, employing the event study method. The market reaction is measured using cumulative abnormal return (CAR), and cross-section regression is employed to examine the determinants of market reaction.

The findings reveal a significant positive reaction in the communication services, consumer staples, healthcare and information technology sectors following the announcement of an increase or decrease in dividends. These results imply that dividend increase announcements serve as a positive signal for investors amidst the COVID-19 pandemic. However, the market does not respond significantly to announcements of decreased and constant dividends during the pandemic as they are perceived as unfavorable signals. This paper also highlights the role of dividends as a communication tool through which companies express optimism in facing the challenges posed by the COVID-19 pandemic to their investors.

This study highlights the role of dividends as a communication tool through which companies express optimism in facing the challenges posed by the COVID-19 pandemic to their investors.

This study offers a novel cross-country analysis of the market reaction to dividend announcements in the ASEAN region, considering both the pandemic and post-pandemic periods and focusing on sectors less impacted by COVID-19. Unlike previous studies that are limited to single-country or sector-specific analyses, our research uniquely addresses the broader ASEAN context and includes insights into the “new normal” period.

The purpose of this study is to examine the causality between the environmental, social and corporate governance (ESG) score, which is the component of banks’ performance obtained from ESG activities, and the capital costs, market values and bankruptcy risk of banks. For this purpose, 117 banks with fully accessible data from 29 developing countries were included.

In the methodology part of the study, the panel causality test developed by Emirmahmutoglu and Köse was used based on the periods 2015–2022. First, the cross-section test and delta tests were performed. Then, Levin, Lin and Chu, Breitung, Im, Pesaran, Shin, Fisher ADF and Fisher-PP panel unit root tests and Emirmahmutoglu and Köse panel causality test were performed.

As a result of the analyses, bidirectional causality was observed between ESG and weighted average cost of capital of private banks. Similarly, bidirectional causality from ESG to company market capitalization and from ESG to the risk indicator ZSCORE was determined in both private and state banks. The results reveal that ESG components should also be considered in relation to financial performance. In this respect, it is expected to guide regulatory and supervisory institutions in the establishment of regulations and guidelines regarding the determination and promotion of ESG practices that will increase capital efficiency and reduce corporate financing costs.

Focusing on ESG activities has ceased to be an arbitrary situation for banks. In today’s competitive conditions, financial institutions are turning to strategies that differentiate them from their competitors, such as ESG, as they have difficulty maintaining customer loyalty. Based on the lack of focus on structure differentiation before, the main research question of this study is whether the private and public structure will cause a difference in the effect of ESG activities on bank performance and cost.

Without a doubt, COVID-19 is a disruptive event that one may not consider before it becomes a global pandemic. This study aims to examine the firm’s risk preference, represented as board characteristics towards COVID-19 exposure in Indonesia.

This study uses the boardroom’s average value of board age and female proportion to represent board characteristics. Fixed-effect regression based on industry (Industry FE) and year (Year FE) analyses 861 firm-year observations of all firms listed on the Indonesian Stock Exchange in 2019–2020.

The result shows a positive relationship between the female board and COVID-19 exposure disclosure. Meanwhile, the age proportion does not offer a significant result. The additional analysis document that the directors mainly drove the result and were only relevant during 2020. These results are robust due to coarsened exact matching tests and Heckman’s two-stage regression. This study enriches COVID-19 literature, especially from a quantitative perspective.

The rise of global crises makes the outputs of this study important for non-financial listed firms in Indonesia.