Market Reaction to Dividend Annoucements During Bear and Bull Periods

The stock market and economic activity move in similar cyclical patterns. This fundamental relationship has important ramifications. Firstly, it is solid evidence that stock prices are meaningful in the sense of reflecting real economic variables and not simply random numbers driven by the psyche,...

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Main Author:	Nurul Hazemira, Abd Rahman
Format:	Thesis
Language:	eng eng
Published:	2010
Subjects:	HG Finance
Online Access:	https://etd.uum.edu.my/2218/1/Nurul_Hazemira_Abd_Rahman.pdf https://etd.uum.edu.my/2218/2/1.Nurul_Hazemira_Abd_Rahman.pdf
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id	my-uum-etd.2218
record_format	uketd_dc
spelling	my-uum-etd.22182013-07-24T12:14:57Z Market Reaction to Dividend Annoucements During Bear and Bull Periods 2010-05 Nurul Hazemira, Abd Rahman Taufil Mohd, Kamarun Nisham College of Business (COB) College of Business HG Finance The stock market and economic activity move in similar cyclical patterns. This fundamental relationship has important ramifications. Firstly, it is solid evidence that stock prices are meaningful in the sense of reflecting real economic variables and not simply random numbers driven by the psyche, sunspots or the pronouncements of self-appointed seers. This study examines the short time price effect of dividend announcements during a bear market and a bull market. The data being used here is gathered from the years of 2000 - 2002, the years after the Asian financial crisis in 1998 and from the years of 2005 - 2007 when investors experienced large capital gains all around the world. The data consists of final dividend announcements and intact observations. The aim of this study is to find out differences in abnormal returns of dividend announcement differ during a bear and a bull market. Generally stated, the aim is to find out do investors value dividends more during a bear market than a bull market and can this be proved by using statistical test. This study is classified as a quantitative study and applies some form of statistical analysis. Therefore, linear regression analysis has been used. The empirical results from this study support that the abnormal returns of dividend announcements during the bear market were positively higher than those declared during a bull market. Thus, investors seem to value dividends more when stock prices are falling. Whereas abnormal returns of dividend announcement during a bull market are slightly smaller than a bear market may due to the investment opportunities by using internal funding that lead to cheaper cost of financing than external financing. The result overall samples state that the abnormal returns during the bear market were positively and slightly higher than during the bull market. 2010-05 Thesis https://etd.uum.edu.my/2218/ https://etd.uum.edu.my/2218/1/Nurul_Hazemira_Abd_Rahman.pdf application/pdf eng validuser https://etd.uum.edu.my/2218/2/1.Nurul_Hazemira_Abd_Rahman.pdf application/pdf eng public http://lintas.uum.edu.my:8080/elmu/index.jsp?module=webopac-l&action=fullDisplayRetriever.jsp&szMaterialNo=0000759277 masters masters Universiti Utara Malaysia
institution	Universiti Utara Malaysia
collection	UUM ETD
language	eng eng
advisor	Taufil Mohd, Kamarun Nisham
topic	HG Finance
spellingShingle	HG Finance Nurul Hazemira, Abd Rahman Market Reaction to Dividend Annoucements During Bear and Bull Periods
description	The stock market and economic activity move in similar cyclical patterns. This fundamental relationship has important ramifications. Firstly, it is solid evidence that stock prices are meaningful in the sense of reflecting real economic variables and not simply random numbers driven by the psyche, sunspots or the pronouncements of self-appointed seers. This study examines the short time price effect of dividend announcements during a bear market and a bull market. The data being used here is gathered from the years of 2000 - 2002, the years after the Asian financial crisis in 1998 and from the years of 2005 - 2007 when investors experienced large capital gains all around the world. The data consists of final dividend announcements and intact observations. The aim of this study is to find out differences in abnormal returns of dividend announcement differ during a bear and a bull market. Generally stated, the aim is to find out do investors value dividends more during a bear market than a bull market and can this be proved by using statistical test. This study is classified as a quantitative study and applies some form of statistical analysis. Therefore, linear regression analysis has been used. The empirical results from this study support that the abnormal returns of dividend announcements during the bear market were positively higher than those declared during a bull market. Thus, investors seem to value dividends more when stock prices are falling. Whereas abnormal returns of dividend announcement during a bull market are slightly smaller than a bear market may due to the investment opportunities by using internal funding that lead to cheaper cost of financing than external financing. The result overall samples state that the abnormal returns during the bear market were positively and slightly higher than during the bull market.
format	Thesis
qualification_name	masters
qualification_level	Master's degree
author	Nurul Hazemira, Abd Rahman
author_facet	Nurul Hazemira, Abd Rahman
author_sort	Nurul Hazemira, Abd Rahman
title	Market Reaction to Dividend Annoucements During Bear and Bull Periods
title_short	Market Reaction to Dividend Annoucements During Bear and Bull Periods
title_full	Market Reaction to Dividend Annoucements During Bear and Bull Periods
title_fullStr	Market Reaction to Dividend Annoucements During Bear and Bull Periods
title_full_unstemmed	Market Reaction to Dividend Annoucements During Bear and Bull Periods
title_sort	market reaction to dividend annoucements during bear and bull periods
granting_institution	Universiti Utara Malaysia
granting_department	College of Business (COB)
publishDate	2010
url	https://etd.uum.edu.my/2218/1/Nurul_Hazemira_Abd_Rahman.pdf https://etd.uum.edu.my/2218/2/1.Nurul_Hazemira_Abd_Rahman.pdf
_version_	1747827292798713856

Market Reaction to Dividend Annoucements During Bear and Bull Periods

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