The impact of dividend announcements on share price and trading volume: empirical evidence from the Gulf Cooperation Council (GCC) countries
Article
Felimban, R., Floros, C. and Nguyen, A. 2018. The impact of dividend announcements on share price and trading volume: empirical evidence from the Gulf Cooperation Council (GCC) countries. Journal of Economic Studies. 45 (2), pp. 210-230. https://doi.org/10.1108/JES-03-2017-0069
Type | Article |
---|---|
Title | The impact of dividend announcements on share price and trading volume: empirical evidence from the Gulf Cooperation Council (GCC) countries |
Authors | Felimban, R., Floros, C. and Nguyen, A. |
Abstract | This paper investigates the stock market response to dividend announcements in high growth emerging markets of Gulf countries. Our sample includes 1092 dividend announcements from 299 listed firms over the period 2010 - 2015. In the environment where there is an absence of capital gain and income tax, we find some evidence for the stock price reaction that partly supports the signaling hypothesis. Our findings show that the GCC market is inefficient because of the leakage information before the announcement in bad news, and the delay of share price adjustment in good news. In addition, we report significant trading volume reaction in all the three announcements clusters, where dividends increase, decrease, and are constant, lending support to the hypothesis that the dividend change announcements have an impact on the trading volume response due to different investors’ preferences. These results are highly recommended to financial analysts and investors dealing with the GCC market. |
Keywords | GCC; Abnormal returns; Abnormal trading volume; Dividend announcements |
Publisher | Emerald |
Journal | Journal of Economic Studies |
ISSN | 0144-3585 |
Publication dates | |
14 May 2018 | |
Publication process dates | |
Deposited | 27 Sep 2017 |
Accepted | 14 Jul 2017 |
Output status | Published |
Accepted author manuscript | |
Copyright Statement | This article is © Emerald Group Publishing and permission has been granted for this version to appear in the Middlesex University Research Repository. Emerald does not grant permission for this article to be further copied/distributed or hosted elsewhere without the express permission from Emerald Group Publishing Limited. This is the accepted version of the manuscript "The impact of dividend announcements on share price and trading volume: empirical evidence from the Gulf Cooperation Council (GCC) countries", published in the "Journal of Economic Studies"available via the journal site at: https://doi.org/10.1108/JES-03-2017-0069 |
Digital Object Identifier (DOI) | https://doi.org/10.1108/JES-03-2017-0069 |
Web of Science identifier | WOS:000430474100001 |
Language | English |
https://repository.mdx.ac.uk/item/87300
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