News Dissemination and Investor Attention

Romain Boulland, Francois Degeorge () and Edith Ginglinger

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Abstract: We examine how investor attention changes when a firm adopts a modern news dissemination technology. We find that after continental European firms begin using an English-language electronic wire service to disseminate company news, they exhibit a stronger initial reaction to earnings surprises, a lower post earnings announcement stock price drift, and an increase in abnormal trading volume near earnings announcements, compared with when they disseminated their news in non-electronic format and in a continental European language. Our results hold for a sub-sample of firms for which the decision to use a wire service was likely exogenous. The effect of wire services on investor attention is due to the format of news (electronic and English-language), not to the increased speed of news transmission.

Keywords: News dissemination; Language; Media coverage; Earnings announcements; Limited attention. (search for similar items in EconPapers)
Date: 2016
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Published in Review of Finance, 2016, ⟨10.1093/rof/rfw018⟩

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Journal Article: News Dissemination and Investor Attention (2017)
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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:halshs-01316170

DOI: 10.1093/rof/rfw018

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