The effect of investor sentiment on market reactions to financial earnings restatements: Lessons from the United States

Bouteska, Ahmed

doi:10.1016/j.jbef.2019.100241

Cited by 24 publications

(15 citation statements)

References 84 publications

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“…After controlling the stock return, market value, book-to-market ratio, and BETA, the coefficient of investor sentiment is also significant, equalling 0.0009 (p = 0.000 < 0.01). Our finding that investor sentiment has a positive effect on stock return is similar to the findings of Hu and Tripathi [32] and Bouteska [33]. e regression results also show that market value, book-tomarket ratio, and stock return on day t − 1 have significant effects on stock return on day t.…”

Section: 2supporting

confidence: 87%

“…Dimpfl and Kleiman [15] find investor pessimism has a negative effect on market return and has a positive effect on volatility and trading volume. Bouteska [33] finds that there is a positive correlation between investor sentiment standard deviation and cumulative abnormal return, and the main factor leading to this relationship is investor conservatism.…”

Section: E Relationship Between Investor Sentiment and Stockmentioning

confidence: 99%

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The Effect of Online Investor Sentiment on Stock Movements: An LSTM Approach

Wang

2020

Complexity

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With more and more investors exerting their voices through network forums or social media platforms, the relationships between online investor sentiment and stock movements have drawn more and more attention. In this paper, we crawl stock comments from China’s most popular online stock forum, East Money (www.eastmoney.com), and then develop a sentiment classifier using the LSTM method. Using the online investor sentiment of the stock forum, we explore the effect of online investor sentiment on the stock movements of CSI300. The results show that online investor sentiment has a significant positive impact on both stock return and trading volume and remains significant after controlling book-to-market ratio, BETA, and market value. Moreover, investor sentiment has a significant positive impact on order imbalance of big trade, which represents the main flow of money in the market. As a result, investor sentiment has a positive impact on the major fund flows in the market. In other words, an increase in investor sentiment can boost the major money flows in the market to some extent. From a practical point of view, investor sentiment can assist investors to make investment decisions and help the government to regulate the stock market.

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Section: 2supporting

confidence: 87%

Section: E Relationship Between Investor Sentiment and Stockmentioning

confidence: 99%

The Effect of Online Investor Sentiment on Stock Movements: An LSTM Approach

Wang

2020

Complexity

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“…Indeed, during the COVID-19 pandemic, we observe a sense of fear from both investors and individuals alike (Samuel et al, 2020). Since the onset of COVID-19, investor sentiment has been dented, and it is well known that investor sentiment plays an important role in asset pricing (Bouteska, 2019;Cagli et al, 2020;Smales, 2014). Sharma (2020) shows how Asian market volatility has been dynamic and sensitive to the pandemic.…”

Section: Introduction I Introductionmentioning

confidence: 91%

Investor Sentiment and Volatility Prediction of Currencies and Commodities During the COVID-19 Pandemic

Hoang

Syed

2021

Asian Economics Letters

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In this note, we examine whether the volatility predictive power of investor sentiment for currencies and commodities is sensitive to the COVID-19 pandemic. The Credit Suisse Fear Barometer (CSFB) and the VIX are used to measure investor sentiment. The volatility of seven major currencies, gold, and oil is investigated. Using daily data from 2005 to 2020, we show that VIX is a better predictor than CSFB. However, they have no predictive power during the COVID-19 pandemic period. This may be attributed to the different nature of fear sentiment during the crisis.

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“…In other words, investors' sentiment measures investors' reactions to the continuous flow of information from markets, which may cause investors to over-or underreact. The role of investors' sentiment is essential as it correlates with market returns and volatility (Bouteska, 2019;Cagli et al, 2020). Brown and Cliff (2005) and Chung et al (2012) claimed that investors' sentiment was subject to change based on market conditions and the flow of information.…”

Section: Figure 1 Ftse Bursa Malaysia Klci Indexmentioning

confidence: 99%

The Impact of the Investor Sentiment Index (SMI) on the Malaysian Stock Market during the COVID 19 Pandamic

ALBADA¹,

NIZAR²

2022

IJEM

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COVID-19 is a highly contagious viral infection that has changed the world, with many human lives being lost. This study aimed to analyse investors' sentiment and stock market behaviour in Malaysia during the COVID-19 pandemic. Stock market performance was measured through the FTSE BURSA 100 Index (T100) from January 29, 2020, until March 31, 2021, by employing principal component analysis (PCA) to construct the investors' Sentiment Index (SMI). The results indicated that the sudden outbreak of COVID-19 and its rapid spread significantly impacted investors' psychology, which disrupted investors' investment decisions. Furthermore, rapid increases in confirmed COVID-19 cases and deaths increased the uncertainty and unpredictability of the country's economic situation. As a result, the Malaysian financial market showed a steep downward trend during the COVID-19 pandemic.

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The effect of investor sentiment on market reactions to financial earnings restatements: Lessons from the United States

Cited by 24 publications

References 84 publications

The Effect of Online Investor Sentiment on Stock Movements: An LSTM Approach

The Effect of Online Investor Sentiment on Stock Movements: An LSTM Approach

Investor Sentiment and Volatility Prediction of Currencies and Commodities During the COVID-19 Pandemic

The Impact of the Investor Sentiment Index (SMI) on the Malaysian Stock Market during the COVID 19 Pandamic

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