Managerial sentiment, consumer confidence and sector returns

Salhin, Ahmed; Sherif, Mohamed; Jones, Edward

doi:10.1016/j.irfa.2016.06.009

Cited by 36 publications

(14 citation statements)

References 32 publications

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“…The index has proven to be one of the most influential variables in consumption decisions and in the economic situation (Bock Eastman, & McKay, 2014;Sorić, 2018). Consumer confidence is influenced by their personal finances and the economic environment, macroeconomic conditions and the business situation (Ferrer et al 2016;Salhin, Sherif, & Jones, 2016;Li, Guo, & Park, 2017).…”

Section: Consumer Confidence Indexmentioning

confidence: 99%

“…From the logit model, the pandemic situation is significantly influencing the changes in investor confidence in the Islamic financial market. Consumer confidence is influenced by their personal finances, economic environment, macroeconomic condition and business situation (Ferrer et al, 2016;Salhin et al, 2016;Li et al, 2017).…”

Section: Probit Logit Model Robustness Standard Errormentioning

confidence: 99%

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How Has the Covid-19 Pandemic Affected the Real and Monetary Sectors in Indonesia?

Yunita

2021

JIMF

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This study aims to find empirical evidence for the effects of the Covid-19 pandemic on the Indonesia real and monetary sectors. The real sector condition is represented by fluctuations in the farmer exchange rate in ten provinces; this rate has direct and indirect effects on farmers’ welfare. On the other hand, the condition of the monetary sector is illustrated by shifts in the consumer confidence index due to fluctuations in Islamic and conventional financial system indicators. We used a panel regression model to examine the farmer exchange rate and a binary logistic regression model to examine the consumer confidence index. The results statistically demonstrate that the pandemic conditions have affected both the real sector and the consumer confidence index of the Islamic financial sector. However, the pandemic has not affected the consumer confidence index of the conventional financial sector. This phenomenon exists because of the speculative action from conventional investors in taking risks and opportunities, which are forbidden in the Islamic context. The indicator which shifts the conventional consumer confidence index is the composite stock index (IHSG), while the Islamic consumer confidence index is shifted by changes in the Islamic money market rate, the Jakarta Islamic index and the Islamic banking capital ratio. Our empirical findings conclude that, in such a critical situation, the behaviour of conventional and Islamic consumers is totally different, thus influencing consumer confidence in each sector.

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Section: Consumer Confidence Indexmentioning

confidence: 99%

Section: Probit Logit Model Robustness Standard Errormentioning

confidence: 99%

How Has the Covid-19 Pandemic Affected the Real and Monetary Sectors in Indonesia?

Yunita

2021

JIMF

View full text Add to dashboard Cite

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“…An assessment of these factors, to a large extent, influences investors' choice of stock (or portfolio) and has the potential to alter the stance of classical market theories (Shefrin and Statman, 2000). However, although many studies in the literature have documented both linear (Edmans et al, 2007; Akansu et al, 2017) and non‐linear relationships (Bollen et al, 2011; Essaddam and Karagianis, 2014; Chu et al, 2016; Salhin et al, 2016; Bekiros et al, 2016; Yang et al, 2017) between stock market behaviour and sentiments, the controversy still lingers due to multifarious and imperfect proxies for market sentiments 4…”

Section: Contextualization Of the Studymentioning

confidence: 99%

“…In a more recent study, Salhin et al (2016) explored the link among managerial confidence, investor confidence and stock returns in the UK between 1985 and 2014. Their study finds that consumer confidence does not affect stock returns in the UK, while managerial sentiment has a significant impact on both sector and aggregate returns.…”

Section: Contextualization Of the Studymentioning

confidence: 99%

“…Furthermore, another group of sentiment studies support the use of consumer surveys as proxies for sentiments (David and Sultan, 1998; Jansen and Nahuis, 2003; Arabian and Zomorrodian, 2007; Chen, 2011; Salhin et al, 2016; Brown and Cliff, 2005; Yang et al, 2017). These studies opine that consumer surveys significantly highlight respondents' financial and socio‐economic status and, in addition, evaluate investors' optimism on future expectations of the economy.…”

Section: Introductionmentioning

confidence: 99%

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Sentiment‐Apt investors and UK sector returns

et al. 2020

Self Cite

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This paper examines the relationship between sentiment‐apt investors and UK stock returns at industry level over the period January 1988 to December 2017. Using two new sentiment proxies (laggards to leaders and growth opportunity index) for 10 discrete sector groupings, we provide novel evidence on how returns in the UK stock market react to the activities of sentiment‐disposed investors. First, using threshold nonlinear regression, we document a significant relationship between the laggards to leaders sentiment proxy and sectoral returns. Our findings reveal that aggregate returns in the sector are affected by activities of investors who embark on profit‐taking when there is an increase in the proportion of lagging to leading stocks beyond the threshold value. Secondly, when using the growth opportunity sentiment proxy, we report that the increase in growth above the growth threshold value has a significant impact on sector returns. This study further confirms significant impact of non‐threshold variables on sector groupings. Our findings are robust, having been subjected to a range of robustness checks.

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Study of the leading European construction companies using risk factor models

2022

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This paper aims to study the potential effects of changes in international risk factors on leading European construction companies' returns. The study is conducted on a sample period between January 2000 and December 2019 and applies an extension of the Fama and French five‐factor model (2015) using the quantile regression methodology. Specifically, this research extends the Fama and French (2015) factor model by adding risk factors such as nominal interest rates, momentum and momentum reversal factors (Carhart, 1997) and the traded liquidity factor (Pastor and Stambaugh, 2003). For robustness, this study splits the entire sample period into three sub‐periods: pre‐crisis, crisis, and post‐crisis. As expected, the highest R2 coefficients are observed in the extreme quantiles, that is, in the bullish and bearish market states, revealing a U‐shaped relationship in the explanatory power of this factor model.

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Managerial sentiment, consumer confidence and sector returns

Cited by 36 publications

References 32 publications

How Has the Covid-19 Pandemic Affected the Real and Monetary Sectors in Indonesia?

How Has the Covid-19 Pandemic Affected the Real and Monetary Sectors in Indonesia?

Sentiment‐Apt investors and UK sector returns

Study of the leading European construction companies using risk factor models

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