 The impact of expected regulatory changes: The case of banks following the 2016 U.S. electionB. Hachenberg, F. Kiesel, S. Kolaric and D. Schiereck Publications of Darmstadt Technical University, Institute for Business Studies (BWL) from Darmstadt Technical University, Department of Business Administration, Economics and Law, Institute for Business Studies (BWL) Abstract: We analyze bank stocks and credit default swap (CDS) spreads around the U.S. presidential election on November 8, 2016. We find a strong rally in bank stocks combined with an overall widening in bank CDS spreads during the days after the announcement of the election result. Following Donald Trump's victory, market participants appear to anticipate a lowering of financial sector regulation, particularly with respect to the Dodd-Frank act. In addition, we find that Global Systemically Important Banks (G-SIBs) reacted more positive than non-G-SIBs, with stocks having larger gains and CDS remaining relatively stable. Non-G-SIB stocks, on the other hand, gained less and their CDS widened, indicating less favorable changes from deregulation than for G-SIBs. Date: 2017-08-01 Published in Finance Research Letters (2017-08-01) : pp. 268-273 Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:dar:wpaper:84772 Access Statistics for this paper More papers in Publications of Darmstadt Technical University, Institute for Business Studies (BWL) from Darmstadt Technical University, Department of Business Administration, Economics and Law, Institute for Business Studies (BWL) Contact information at EDIRC. |
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