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Do investors react differently? Evidence from hospitality sector during the covid-19 pandemic

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  • Tosun, Onur Kemal

Abstract

Focusing on publicly traded U.S. eating & dining and lodging firms from 01July2019 to 30October2020, this paper examines investor reaction to restaurant and hotel firms throughout the Covid-19 pandemic. Results show that there is no consensus on buying or selling shares of different hospitality firms in the beginning. Consistent with the behavioral theory, the market reaction is mainly negative to restaurant firms matching with investors’ negative sentiments while investors are indifferent towards lodging firms. In later stages, investors trade less stocks, and the buy pressure in the market leads to a positive reaction to both types of firms.

Suggested Citation

  • Tosun, Onur Kemal, 2022. "Do investors react differently? Evidence from hospitality sector during the covid-19 pandemic," Finance Research Letters, Elsevier, vol. 49(C).
    • Handle: RePEc:eee:finlet:v:49:y:2022:i:c:s1544612322003245
    DOI: 10.1016/j.frl.2022.103099
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    References listed on IDEAS

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    More about this item

    Keywords

    Investors; Covid-19; Hospitality sector; Eating & dining firms; Lodging firms; Behavioral theory;
    All these keywords.

    JEL classification:

    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
    • G12 - Financial Economics - - General Financial Markets - - - Asset Pricing; Trading Volume; Bond Interest Rates
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • L20 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - General

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