Environmentally Oriented Energy Policy and Stock Returns: An Empirical Analysis

Oberndorfer, Ulrich; Ziegler, Andreas

doi:10.2139/ssrn.949417

Cited by 13 publications

(4 citation statements)

References 42 publications

(42 reference statements)

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“…If information has been available before the event, which is often the case, abnormal returns should not occur as the news is already priced in by the financial markets. Many of those studies have important features in common with our own analysis: Often, electric utility stocks are analysed (Butler and McNertney, 1991, Diltz, 2002, Kahn and Knittel, 2003, Oberndorfer and Ziegler, 2006. Besides that, those papers have in common with the assessment conducted here that they assess the influence of a general shock related to resource, energy, or environmental economics on stock returns.…”

Section: Literature Reviewmentioning

confidence: 98%

Lost in Transmission? Stock Market Impacts of the 2006 European Gas Crisis

2007

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Recently, energy security in Western Europe seems to be at risk. Around the turn of the year 2005/2006, the Russian freezing of natural gas exports to and via the Ukraine led to a European gas crisis, triggering off intensive debates about energy security all over Europe. Using an event study approach, we assess whether or not the Russian announcement of suspension of gas deliveries, this suspension itself as well as its withdrawal had an impact on West European utilities' as well as oil and gas companies' stocks. Besides the intention of putting the phenomenon of energy security on the agenda of economists dealing with financial markets, this paper should contribute to the methodological enhancements of event studies in the field of resource and environmental economics. In this respect, besides looking at stock returns, we consider autoregressive conditional heteroskedasticity in our methodological framework and assess event impacts on return volatility. We find that the announcement of the crisis accompanied by resource and electricity price increases and therefore a rise of Western Europe's energy risk and costs tended to increase market expectations with respect to energy-related firms. The renewal of gas deliveries increased market uncertainty. One factor behind these findings could be windfall profits of energy-related companies due to increasing resource and electricity prices. All in all, our results suggest that energy policy does not have to bear in mind negative effects for energyrelated firms in situations when security of energy supply is in danger. In contrast, our findings indicate that the energy sector may even profit from energy crises that induce resource price hikes. Given this, it is far from surprising that policy generally considers energy supply as a matter of public concern that should not fully be left to the strategic calculus of private companies.

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Section: Literature Reviewmentioning

confidence: 98%

Lost in Transmission? Stock Market Impacts of the 2006 European Gas Crisis

2007

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“…Berbeda dengan hasil penelitian Anggarani (2012) yang menemukan abnormal return namun tidak signifikan pada pemilu tahun 2009. Hasil yang sama dikemukakan oleh Oberndorfer and Ziegler (2006) yang juga menemukan abnormal return pada peristiwa penetapan regulasi lingkungan pada return saham perusahaan energi jerman, namun tidak signifikan. Hall dan Kenjegaliev (2009) juga tidak menemukan abnormal return dalam kasus tanggal peristiwa acak untuk harga saham perusahaan minyak.…”

Section: Pendahuluanunclassified

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Suhaedi¹,

Nurabiah²,

Anjani³

2018

Aksioma

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The 411 and 212 rally related to the issue of religious blasphemy has drawn the attention of Indonesian people and also became the news of the world. Both events cause some positive and negative perceptions of society and government as well as the investors since it will likely impact the stock price in Indonesia capital market as represented by value of abnormal return. Therefore, this study aimed to prove the presence or absence of the impact of both events to the stock price. This study was conducted on 100 samples of companies listed on the Kompas 100 index during August 2016-January 2017. This research is a comparative descriptive study by using event study approach. The test was performed by using Wilcoxon one sample test and Wilcoxon paired samples test. The results of this study indicate that the stock prices tend to fall before the 411 rallies took place. Although the event did not have an impact on stock price changes at the time of the 411 rallies happened, the stock prices tend to rise after the action of 411 rallies took place. The results of this study also indicate that the stock prices tend to fall before until the 212 rallies took place then tend to rise after the action of 212.

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“…Another perspective is where pollution information and environmental awareness play important role in stock performance [4]. A few studies associate reactions to environmental regulation and company's environment protection efforts as an indicator of stock performance [5][6][7].…”

Section: Introductionmentioning

confidence: 99%

Is Deteriorating Air Quality Impacting Stock Performance in India? Air Quality Index Predicts Stock Performance

Reddy¹

2020

IJST

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Background/objectives: This study attempts to examine a systematic relationship between air quality index (AQI) and the performance of stock markets in India. India has ranked among the bottom five countries in environmental performance index (EPI) by World Economic Forum (WEF). Previous studies in this field conducted in other parts of the world indicate a direct relation between environmental performance and market performance; however, the case of India may prove to be different considering the Indian environmental policy, environmental accountability, population, and income and development aspects. Methods: We have employed linear regression technique to ascertain the impact of AQI on stock returns. AQI data from 13 stations across India are the dependent variables. These dependent variables are each regressed individually for each stock market index from Bombay Stock Exchange (BSE) equity index, Sensex. Therefore, there are 17 models where AQI from the chosen 13 stations has been regressed with each of the industry specific index. A descriptive analysis is also performed to know the yearly averages of the AQI across stations used in the study. Findings: Our results confirm that there exists a negative association between AQI and stock returns for top-performing growth stocks. The results also indicate that there is a positive association between AQI and capital intensive industry stocks, while a negative association was observed in the case of labor-intensive industries. The findings indicate that AQI is a predictor for stock returns in India in the short term. Application: Environmental influences on stock market performance are becoming more potent than ever before as the negative externalities of pollution impact the financial performance of corporations.

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Environmentally Oriented Energy Policy and Stock Returns: An Empirical Analysis

Cited by 13 publications

References 42 publications

Lost in Transmission? Stock Market Impacts of the 2006 European Gas Crisis

Lost in Transmission? Stock Market Impacts of the 2006 European Gas Crisis

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Is Deteriorating Air Quality Impacting Stock Performance in India? Air Quality Index Predicts Stock Performance

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