Exploring the connections: Dividend announcements, stock market returns, and major sporting events

Fakhrul Hasan () and Basil Al-Najjar ()
Additional contact information
Fakhrul Hasan: Northumbria University
Basil Al-Najjar: Manchester Metropolitan University

Review of Quantitative Finance and Accounting, 2024, vol. 63, issue 3, No 4, 889-923

Abstract: Abstract This study conducts a detailed investigation into the interplay between major sporting events, specifically the ICC Cricket World Cups and FIFA Football World Cups, and their potential impact on the relationship between dividend announcements and stock market returns. Beyond the customary exploration of investor sentiment and its connection to stock market returns, our research thoroughly examines the effects of these significant sports events on the stock market's reaction to dividend announcements. Drawing on extensive FTSE 350 index data spanning January 1990 to December 2021, we employ event study methodology as the primary analytical framework. To bolster the reliability of our findings, we apply the Generalized Method of Moments (GMM) estimation method, addressing potential endogeneity concerns. Our results uncover a distinct pattern—the stock market exhibits a less favourable response to dividend increases announced following England's victories in major sporting events, such as the FIFA Football World Cup and ICC Cricket World Cup, compared to instances where they faced defeat. Additionally, we observe a more negative market response to dividend decreases announced following England's losses in these pivotal sporting events, as opposed to England emerging victorious in these key contests. This research contributes valuable insights into the intricate relationship between sports passion and market dynamics, offering implications for both scholarly discourse and investment strategy formulation.

Keywords: Dividend policy; Cricket world cup; Football world cup; Stock market; G14; G41; Z23 (search for similar items in EconPapers)
Date: 2024
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://link.springer.com/10.1007/s11156-024-01277-1 Abstract (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:kap:rqfnac:v:63:y:2024:i:3:d:10.1007_s11156-024-01277-1

Ordering information: This journal article can be ordered from
http://www.springer.com/finance/journal/11156/PS2

DOI: 10.1007/s11156-024-01277-1

Access Statistics for this article

Review of Quantitative Finance and Accounting is currently edited by Cheng-Few Lee

More articles in Review of Quantitative Finance and Accounting from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().