An Event Based Analysis of Stock Return and Political Uncertainty in Pakistan: Revisited

Audi, Marc; Sulehri, Fiaz Ahmad; Ali, Amjad; Al-Masri, Razan

doi:10.32479/ijefi.13239

Cited by 15 publications

(11 citation statements)

References 19 publications

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“…They provide evidence that investment growth may be affected by policy uncertainty. According to more recent research, policy uncertainty is to blame for declining business investment spending during the global financial crisis [7,8].…”

Section: Introductionmentioning

confidence: 99%

Economic Policy Uncertainty and Firm Value: Impact of Investment Sentiments in Energy and Petroleum

et al. 2023

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This study seeks to determine how economic policy uncertainty (EPU) influences investment decisions and the market value of the Pakistan Stock Exchange. This study examines investment and operational data from 249 energy and petroleum companies between 2015 and 2020 and macroeconomic variables such as EPU. This study investigates the moderating effects of EPU on investments in fixed and intangible assets and its effect on Tobin’s Q and the market price per share. The outcomes demonstrate that EPU reduces the costs of both tangible and intangible assets for businesses. In addition, companies with a higher Tobin’s Q and market price per share are more impacted by uncertain corporate investment policies. However, financial leverage is negatively correlated with share price and positively correlated with earnings per share and earnings per unit. Tobin’s Q positively correlates with financial leverage, indicating that firms that raise capital through debt are more likely to create value for investors. The research indicates that market-dependent enterprises are more susceptible to the unpredictability of monetary policy. According to this study, consistent application and open communication of economic policies are likely to increase the efficacy of company investments, resulting in more effective resource allocation and business decision-making.

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Section: Introductionmentioning

confidence: 99%

Economic Policy Uncertainty and Firm Value: Impact of Investment Sentiments in Energy and Petroleum

et al. 2023

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“…An event-based analysis to judge relation between political events of Pakistan with its stock market was done in 2022 (Audi et al, 2022). The Pakistan Stock Exchange is impacted by political events, according to this study's findings, but the effects vary depending on the events' political and economic ramifications.…”

Section: Literature Reviewmentioning

confidence: 82%

Does political crisis impact the capital market returns in Bangladesh?

Roy,

Akter,

Lukman

2023

JFMG

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This study aims at figuring out the key reasons responsible for inhibiting companies to go for IPO. For the purpose, 100 privately listed companies situated in Dhaka had been approached and 15 companies responded. To substantiate the views of the companies, interviews from academician, merchant bank authorities, capital market journalist forum, and regulators were taken. In total, 25 Key Informant Interviews (KIIs) were conducted for the study. A focus group discussion (FGD) was arranged consisting 30 representatives from different merchant banks. To present the findings of the study, a thematic analysis approach was chosen where initial codes from the interviews and FGD were transformed and six key themes: macro-environment deterrent, institutional limitations, firm specific barriers, capital market deterrents, corporate governance code 2018, and money market deterrents were identified as the main factors of IPO avoidance by eligible companies. The study revealed that lack of coordination among relevant policy makers, few clauses of corporate governance code 2018, costly and lengthy IPO issuance process, insignificant tax gap, bank’s lenience towards loan defaulters, loan rescheduling facility of banks, lack of knowledge regarding capital market products, and compliance related issues are considered the most crucial reasons for IPO avoidance.

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“…On the other hand, when there is a significant amount of volatility in exchange rates, the effect of EPU shock on correlations is minimal. When there is a reasonably large amount of exchange rate volatility, the impact is that changes in significant events are used to respond to different kinds of economic circumstances and shocks (Audi et al, 2022;Audi et al, 2023). As a result, EPU may cause a variety of shocks, some of which are asymmetrical, at varying quantiles of exchange rate volatility.…”

Section: Figure 1 Pattern Of Exchange Rate and Economic Policy Uncert...mentioning

confidence: 99%

Effect of Economic Policy Uncertainty on Exchange Rate Volatility in Pakistan

Shair,

Ahmad,

Tayyab

et al. 2023

BBE

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This study examines the effect of economic policy uncertainty on Pakistan’s exchange rate. Pakistan’s exchange rate always remains under pressure due to the widening inflow-outflow gap in foreign exchange. The volatile exchange rates make it harder for businesses to invest and make inflation more uncertain, which ultimately slows down productivity and GDP growth. Due to the close linkages of the exchange rate with the economic indicators, it is required to examine the effect of different economic variables on the exchange rate and its volatility by incorporating the role of economic policy uncertainty. The study uses the sample of Jan 2011 to Dec 2022 for the empirical results. The study employs the EGARCH model for empirical results. The aftermaths of the mean equation of the EGARCH model suggest that economic policy uncertainty has a positive effect on Pakistan’s exchange rate. Moreover, an increase in the economic policy uncertainty scale, increases the volatility in Pakistan’s exchange rate. The primary source of exchange rate volatility is the nominal variable rather than the real variables. On the basis of the study’s findings, certain relevant recommendations were given in order to stabilize the foreign exchange market in Pakistan.

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An Event Based Analysis of Stock Return and Political Uncertainty in Pakistan: Revisited

Cited by 15 publications

References 19 publications

Economic Policy Uncertainty and Firm Value: Impact of Investment Sentiments in Energy and Petroleum

Economic Policy Uncertainty and Firm Value: Impact of Investment Sentiments in Energy and Petroleum

Does political crisis impact the capital market returns in Bangladesh?

Effect of Economic Policy Uncertainty on Exchange Rate Volatility in Pakistan

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