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Year 2023, Volume: 16 Issue: 1, 7 - 9, 01.02.2023
https://doi.org/10.17261/Pressacademia.2023.1656

Abstract

References

  • Al-Maadid, A., Caporale, G. M., Spagnolo, F., & Spagnolo, N. (2020). The impact of business and political news on the GCC stock markets. Research in International Business and Finance, 52, 101-102.
  • Al-Thaqeb, S. A. (2018). Do international markets overreact? Event study: International market reaction to US local news events. Research in International Business and Finance, 44, 369-385.
  • De Bondt, W. F., & Thaler, R. (1985). Does the stock market overreact? The Journal of Finance, 40(3), 793-805.
  • Fama, E. (1970). Efficient capital markets: A review of theory and empirical work. The Journal of Finance. 25(2), 383-417.
  • Howe, J.S. (1986). Evidence on stock market overreaction.Financial Analysts Journal, 42(4), 74-77.
  • Karime, S., & Sayilir, Ö. (2019). Political news and stock market reactions: evidence from Turkey over the period 2008–2017. International Journal of Management and Economics, 55(2), 83-98.
  • Kirana, N., & Sembel, R. (2019). The effect of political event on the Indonesian Stock Market: an event study of presidential election on LQ45 Index Stocks. International Journal of Business, Economics and Law, 19(1), 40-49.
  • Muth, J. F. (1961). Rational expectations and the theory of price movements. Econometrica. 29(3), 315-335.
  • Ramesh, S., & Rajumesh, S. (2015). Stock market reaction to political events a study of listed companies in Colombo Stock Exchange of Sri Lanka. Journal of Economics and Sustainable Development, 6(3), 131-139.
  • Ross, S. A., Westerfield, W. R. ve Jordan, B. D. (2013). Fundamentals of Corporate Finance. New York: McGraw-Hill.
  • Stevens, R. and Rıdge, S. (2018). Reducing the risk of Black Swans: Using the science of investing to capture the returns with less volatility. Bam Alliance Press, St. Louis: USA.
  • Taleb, N.N. (2007). The black swan: The impact of the highly improbable. Random House.

INVESTORS' OVERREACTION TO POLITICAL NEWS: THE CASE OF TURKEY

Year 2023, Volume: 16 Issue: 1, 7 - 9, 01.02.2023
https://doi.org/10.17261/Pressacademia.2023.1656

Abstract

Purpose – Information underlies the stock price movements. There are lots of economic and political news that have an impact on the stock price. Unlike other studies (extensively considering economic news), this paper aims to detect abnormal returns resulting from important political news from 2010 to 2022 in Turkey.
Methodology – To determine the abnormal returns-overreactions, this paper utilized the market-based event study approach and the results were corroborated by non-parametric test statistics.
Findings – Crucial important news occurring between 2010-2022, led to statistically significant negative abnormal reactions the day before the event days. These results show that the banking sector dissociates negatively from reference market reaction.
Conclusion – It is deduced that some investors got information about political events before the events day, and so they priced the information. This result implies that Semi- Strong Efficient Market Hypothesis is not valid.

References

  • Al-Maadid, A., Caporale, G. M., Spagnolo, F., & Spagnolo, N. (2020). The impact of business and political news on the GCC stock markets. Research in International Business and Finance, 52, 101-102.
  • Al-Thaqeb, S. A. (2018). Do international markets overreact? Event study: International market reaction to US local news events. Research in International Business and Finance, 44, 369-385.
  • De Bondt, W. F., & Thaler, R. (1985). Does the stock market overreact? The Journal of Finance, 40(3), 793-805.
  • Fama, E. (1970). Efficient capital markets: A review of theory and empirical work. The Journal of Finance. 25(2), 383-417.
  • Howe, J.S. (1986). Evidence on stock market overreaction.Financial Analysts Journal, 42(4), 74-77.
  • Karime, S., & Sayilir, Ö. (2019). Political news and stock market reactions: evidence from Turkey over the period 2008–2017. International Journal of Management and Economics, 55(2), 83-98.
  • Kirana, N., & Sembel, R. (2019). The effect of political event on the Indonesian Stock Market: an event study of presidential election on LQ45 Index Stocks. International Journal of Business, Economics and Law, 19(1), 40-49.
  • Muth, J. F. (1961). Rational expectations and the theory of price movements. Econometrica. 29(3), 315-335.
  • Ramesh, S., & Rajumesh, S. (2015). Stock market reaction to political events a study of listed companies in Colombo Stock Exchange of Sri Lanka. Journal of Economics and Sustainable Development, 6(3), 131-139.
  • Ross, S. A., Westerfield, W. R. ve Jordan, B. D. (2013). Fundamentals of Corporate Finance. New York: McGraw-Hill.
  • Stevens, R. and Rıdge, S. (2018). Reducing the risk of Black Swans: Using the science of investing to capture the returns with less volatility. Bam Alliance Press, St. Louis: USA.
  • Taleb, N.N. (2007). The black swan: The impact of the highly improbable. Random House.
There are 12 citations in total.

Details

Primary Language English
Subjects Finance, Business Administration
Journal Section Articles
Authors

Ahmet Galip Gencyurek This is me 0000-0002-5842-7942

Publication Date February 1, 2023
Published in Issue Year 2023 Volume: 16 Issue: 1

Cite

APA Gencyurek, A. G. (2023). INVESTORS’ OVERREACTION TO POLITICAL NEWS: THE CASE OF TURKEY. PressAcademia Procedia, 16(1), 7-9. https://doi.org/10.17261/Pressacademia.2023.1656
AMA Gencyurek AG. INVESTORS’ OVERREACTION TO POLITICAL NEWS: THE CASE OF TURKEY. PAP. February 2023;16(1):7-9. doi:10.17261/Pressacademia.2023.1656
Chicago Gencyurek, Ahmet Galip. “INVESTORS’ OVERREACTION TO POLITICAL NEWS: THE CASE OF TURKEY”. PressAcademia Procedia 16, no. 1 (February 2023): 7-9. https://doi.org/10.17261/Pressacademia.2023.1656.
EndNote Gencyurek AG (February 1, 2023) INVESTORS’ OVERREACTION TO POLITICAL NEWS: THE CASE OF TURKEY. PressAcademia Procedia 16 1 7–9.
IEEE A. G. Gencyurek, “INVESTORS’ OVERREACTION TO POLITICAL NEWS: THE CASE OF TURKEY”, PAP, vol. 16, no. 1, pp. 7–9, 2023, doi: 10.17261/Pressacademia.2023.1656.
ISNAD Gencyurek, Ahmet Galip. “INVESTORS’ OVERREACTION TO POLITICAL NEWS: THE CASE OF TURKEY”. PressAcademia Procedia 16/1 (February 2023), 7-9. https://doi.org/10.17261/Pressacademia.2023.1656.
JAMA Gencyurek AG. INVESTORS’ OVERREACTION TO POLITICAL NEWS: THE CASE OF TURKEY. PAP. 2023;16:7–9.
MLA Gencyurek, Ahmet Galip. “INVESTORS’ OVERREACTION TO POLITICAL NEWS: THE CASE OF TURKEY”. PressAcademia Procedia, vol. 16, no. 1, 2023, pp. 7-9, doi:10.17261/Pressacademia.2023.1656.
Vancouver Gencyurek AG. INVESTORS’ OVERREACTION TO POLITICAL NEWS: THE CASE OF TURKEY. PAP. 2023;16(1):7-9.

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