Wealth Effect Of International Investment Announcements: Evidence From Developing Market
This research provides evidence on the efficiency of one of the fastest developing and largest emerging securities market (Kuala Lumpur Stock Exchange, KLSE) in the Asia Pacific rim with respect to foreign investment announcements. Specifically, our study focuses on international investment annou...
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| Format: | Article |
| Published: |
Asian Academy of Management (AAM)
2006
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| Online Access: | http://web.usm.my/aamj/11.1.2006/AAMJ%2011-1-3.pdf http://web.usm.my/aamj/11.1.2006/AAMJ%2011-1-3.pdf http://eprints.usm.my/35852/1/AAMJ_11%2D1%2D3.pdf |
| Summary: | This research provides evidence on the efficiency of one of the fastest developing and
largest emerging securities market (Kuala Lumpur Stock Exchange, KLSE) in the Asia
Pacific rim with respect to foreign investment announcements. Specifically, our study
focuses on international investment announcements made in 1990 through 2000 for firms
listed on the main board of the KLSE of Malaysia. The result shows that the
announcements of foreign investment produce a significant positive daily abnormal
return surrounding the event period. This implies that foreign investment announcements
made by listed Malaysian firms do contain new relevant information which may creates
market movements. At the same time, since the reaction is significantly positive, this
implies that investors generally favor the international investment efforts of Malaysian
firms listed at KLSE. In addition, it is also discovered that the economic development of
the target country does influence the wealth creation process. |
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