The Reaction of Bahrain Bourse to Announcement of Annual Financial Results

The Reaction of Bahrain Bourse to Announcement of Annual Financial Results

International Review of Business Research Papers

Vol. 12. No. 1. , March 2016, Pages: 64 – 75

The Reaction of Bahrain Bourse to Announcement of Annual Financial Results

Iqbal Thonse Hawaldar

The study tests the reaction of Bahrain Bourse to 2014 annual financial results announcement. The study is based on 30 companies. The researcher used event study methodology. The behaviour of average abnormal returns (AARs) and cumulative average abnormal returns (CAARs) are examined for 30 days prior to and 31 days after the announcement of annual financial results. Runs test, sign test and t-test statistics on AARs are statistically not significant. However, t-values on CAARs are statistically significant. Therefore, we conclude that Bahrain Bourse is not efficient in the semi-strong form. The findings help regulators to initiate measures to ensure market efficiency.

JEL Codes: G13, G14, G 15, G18, C32 and F30

DOI : http://dx.doi.org/10.21102/irbrp.2016.03.121.05