Consumer confidence indices and stock markets' meltdowns

Ferrer, Elena; Salaber, Julie; Zalewska, Anna

doi:10.1080/1351847x.2014.963634

Cited by 43 publications

(18 citation statements)

References 45 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%

“…Changes in consumption will affect business cycle fluctuations, reduce demand for goods and services and production output, reduce wage levels, and increase unemployment (Acemoglu & Scoot, 1994). The consumer confidence index is a barometer of the economic health of a country from the consumers' perspective (Ferrer, Salaber, & Zalewska, 2016). The index reflects consumers' degree of optimism in the general state of the economy and can be of value when forecasting economic conditions (Morlino & Quaranta, 2016).…”

Section: Introduction 11 Backgroundmentioning

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%

Section: Introduction 11 Backgroundmentioning

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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“…Secondly, their study also discloses that investor sentiment has the potential to create stock market crises. Finally, Ferrer et al (2016) examined the relationship between consumer confidence indices and stock market meltdowns, using the dotcom and recent global financial crises. Their findings suggest that it is not always the case that consumer confidence will be positively related to expected stock market returns.…”

Section: Contextualization Of the Studymentioning

confidence: 99%

Sentiment‐Apt investors and UK sector returns

et al. 2020

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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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“…These indicators, described in Tables 1 and 2, are similar to the ones used in previous research (e.g. Fisher and Statman, 2003;Qiu and Welch, 2006;Lemmon and Portniaguina, 2006;Ferrer et al, 2016). Since they are all proxies for the same concept, the authors followed related research (e.g.…”

mentioning

confidence: 93%

The market, macroeconomic, and behavioural factors in emerging markets: the case of Poland

Schabek¹,

Barros²

2021

Argumenta Oeconomica

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The study tests a broad set of market, macroeconomic, and behavioural factors in the Polish stock market using local and US data. In time series regressions, employing general-to-specific modelling and principal component analysis, the authors found that both local and foreign aggregate indicators significantly predict the behaviour of a broad portfolio of Polish stocks. However, no common factor is able to explain the cross-section of expected returns in Poland. Only firm-specific characteristics, in particular market/book value and momentum, show significance in the cross-sectional analysis. The results are consistent with recent methodological critiques, suggesting that most candidate factors fail to explain the cross-section of expected returns when more stringent inference procedures are adopted.

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Consumer confidence indices and stock markets' meltdowns

Cited by 43 publications

References 45 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

The market, macroeconomic, and behavioural factors in emerging markets: the case of Poland

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