Would the lag in stock reactions in GCC markets be a sign of a language effect? An application to CRAs’ announcements

Turki Alshammari ()
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Turki Alshammari: CEREFIGE - Centre Européen de Recherche en Economie Financière et Gestion des Entreprises - UL - Université de Lorraine

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Abstract: The stock markets in the Gulf Cooperation Council (GCC) countries are characterized by the domination of individual investors, therefore, we investigate how this characteristic may influence markets' behavior. We examine the market reaction to the announcements conveyed by the major international credit rating agencies' (CRAs). We assume the English language used by the CRAs to publish their news may fail to reduce the asymmetric information in GCCs, due to the low level of English knowledge amongst the individuals. We apply a questionnaire and an event-study and we find evidence for an influence of the English language on the individuals' reaction.

Keywords: Credit rating agencies; Event-study; questionnaire; language effect; Individual domination (search for similar items in EconPapers)
Date: 2020-07-29
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Published in RESEARCH WORLD INTERNATIONAL CONFERENCE, Jul 2020, Lisbon, Portugal

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-03021603

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