A Perspective on Industry Classification and Market Reaction to Corporate News: Evidence from India Cover Image

A Perspective on Industry Classification and Market Reaction to Corporate News: Evidence from India
A Perspective on Industry Classification and Market Reaction to Corporate News: Evidence from India

Author(s): Nayanjyoti Bhattacharjee, Anupam De
Subject(s): Economy, National Economy
Published by: Editura Universităţii »Alexandru Ioan Cuza« din Iaşi
Keywords: corporate news; event study; industry classification; abnormal return; trading volume;

Summary/Abstract: In this paper, we provide a cross-industry perspective on the market reaction to different corporate news in the context of Indian stock market. We have studied the price and volume movements associated with eight broadly defined news categories namely Analyst Calls, Earnings, Earnings Forecasts, Finance, Legal and Regulatory, Management, Operations and Restructuring. We have employed the standard event study methodology on a sample of stocks listed on the National Stock Exchange of India for the purpose of our study. We observe that the market reaction to firm specific corporate news varies according to the type of news across different industry groups. We also observe that the sentiment of the news is a critical factor which influences the market reaction to such news flow across industry groups. We also provide a cross- industry perspective on the relative importance of different corporate news categories after taking into account the sentiment of the news in the context of Indian stock market.

  • Issue Year: 65/2018
  • Issue No: 1
  • Page Range: 31-50
  • Page Count: 20
  • Language: English