Announcements effect of corporate bond issuance on share price returns Evidence from three emerging markets
Document Type
Article
Publication Date
6-1-2020
Abstract
Purpose The purpose of this paper is to investigate the effect of bond issuance announcements on share price returns in three emerging markets and examine the characteristics of bond issues that affect the abnormal share price returns of the company. Design/methodology/approach This study employs event study, correlation and multiple regression techniques to attain the research objectives. The authors test hypotheses on 105 public listed companies from Malaysia, Singapore and Thailand, during the period of 2008-2014. Findings The findings show positive cumulative average abnormal returns resulting from the announcement of corporate bond issuance for Malaysia, Singapore and Thailand. The results reveal that there is a significant effect of bond issuance announcements on share price returns. The results also disclose that the market is not efficient at its semi-strong form as proposed by the market efficiency hypothesis. Originality/value The results provide better references for fund managers and investors in capital markets to take advantage of the abnormal returns resulting from bond issuance announcements.
Keywords
Emerging markets, Corporate bond, Share price returns
Divisions
Finance_and_Banking
Publication Title
INTERNATIONAL JOURNAL OF EMERGING MARKETS
Volume
15
Issue
3
Publisher
EMERALD GROUP PUBLISHING LTD
Publisher Location
HOWARD HOUSE, WAGON LANE, BINGLEY BD16 1WA, W YORKSHIRE, ENGLAND