IDEAS home Printed from https://ideas.repec.org/p/osf/osfxxx/4dgne_v1.html
   My bibliography  Save this paper

Impacts of International Sports Events on the Stock Market: Evidence from the Announcement of the 18th Asian Games and 30th Southeast Asian Games

Author

Listed:
  • Harjito, Dwipraptono Agus
  • Alam, Md. Mahmudul

    (Universiti Utara Malaysia)

  • Dewi, Rani Ayu Kusuma

Abstract

This research assesses the influence of hosting major international sporting competitions on the host countries’ stock market performance before and after the announcement of such events. Specifically, this study explores whether stock markets of hosting countries experience cumulative average abnormal return (CAAR) during the aforementioned period. For the purposes of investigation, the study considers announcements of the 18th Asian Games and 30th SEA Games hosted by Indonesia and the Philippines, respectively. The LQ45 index of the Indonesia Stock Exchange (IDX) and PSEi index of the Philippines Stock Exchange (PSE) were chosen to test the significance of these events. It is found that only PSE has experienced a significantly positive CAAR for the event. Findings of this study can make a significant contribution to helping national governments and investors understand the significance of sports to the economies of developing countries and how major sports events can improve stock market efficiency.

Suggested Citation

  • Harjito, Dwipraptono Agus & Alam, Md. Mahmudul & Dewi, Rani Ayu Kusuma, 2021. "Impacts of International Sports Events on the Stock Market: Evidence from the Announcement of the 18th Asian Games and 30th Southeast Asian Games," OSF Preprints 4dgne_v1, Center for Open Science.
    • Handle: RePEc:osf:osfxxx:4dgne_v1
    DOI: 10.31219/osf.io/4dgne_v1
    as

    Download full text from publisher

    File URL: https://osf.io/download/61fa0dc679e2720b4320e3b1/
    Download Restriction: no
    File URL: https://libkey.io/10.31219/osf.io/4dgne_v1?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Bana Abuzayed, 2013. "Sport and emerging capital markets: market reaction to the 2022 World Cup announcement," International Journal of Islamic and Middle Eastern Finance and Management, Emerald Group Publishing Limited, vol. 6(2), pages 122-141, June.
    2. Md. Mahmudul Alam & Haitian Wei & Abu N. M. Wahid, 2021. "COVID‐19 outbreak and sectoral performance of the Australian stock market: An event study analysis," Australian Economic Papers, Wiley Blackwell, vol. 60(3), pages 482-495, September.
    3. Fourie, Johan & Santana-Gallego, María, 2011. "The impact of mega-sport events on tourist arrivals," Tourism Management, Elsevier, vol. 32(6), pages 1364-1370.
    4. Amélie Charles & Olivier Darné, 2016. "Stock market reactions to FIFA World Cup announcements: An event study," Economics Bulletin, AccessEcon, vol. 36(4), pages 2028-2036.
    5. Khan, Habib Hussain & Kutan, Ali M. & Naz, Iram & Qureshi, Fiza, 2017. "Efficiency, growth and market power in the banking industry: New approach to efficient structure hypothesis," The North American Journal of Economics and Finance, Elsevier, vol. 42(C), pages 531-545.
    6. Dennis Coates & Brad R. Humphreys, 2008. "Do Economists Reach a Conclusion on Subsidies for Sports Franchises, Stadiums, and Mega-Events?," Econ Journal Watch, Econ Journal Watch, vol. 5(3), pages 294-315, September.
    7. Holger Preuss, 2013. "The Contribution of the FIFA World Cup and the Olympic Games to Green Economy," Sustainability, MDPI, vol. 5(8), pages 1-20, August.
    8. Maneenop, Sakkakom & Kotcharin, Suntichai, 2020. "The impacts of COVID-19 on the global airline industry: An event study approach," Journal of Air Transport Management, Elsevier, vol. 89(C).
    9. Ramzi Benkraiem & Waël Louhichi & Pierre Marques, 2009. "Market reaction to sporting results The case of European listed football clubs," Post-Print halshs-00428516, HAL.
    10. J. K. Ashton & B. Gerrard & R. Hudson, 2003. "Economic impact of national sporting success: evidence from the London stock exchange," Applied Economics Letters, Taylor & Francis Journals, vol. 10(12), pages 783-785.
    11. Bourdeau-Brien, Michael & Kryzanowski, Lawrence, 2020. "Natural disasters and risk aversion," Journal of Economic Behavior & Organization, Elsevier, vol. 177(C), pages 818-835.
    12. Mian Sajid Nazir & Hassan Younus & Ahmad Kaleem & Zeshan Anwar, 2014. "Impact of political events on stock market returns: empirical evidence from Pakistan," Journal of Economic and Administrative Sciences, Emerald Group Publishing Limited, vol. 30(1), pages 60-78, May.
    13. Robert J. Shiller, 2003. "From Efficient Markets Theory to Behavioral Finance," Journal of Economic Perspectives, American Economic Association, vol. 17(1), pages 83-104, Winter.
    14. Fahad Almudhaf, 2018. "Predictability, Price Bubbles, and Efficiency in the Indonesian Stock-Market," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 54(1), pages 113-124, January.
    15. Kaplanski, Guy & Levy, Haim, 2010. "Exploitable Predictable Irrationality: The FIFA World Cup Effect on the U.S. Stock Market," Journal of Financial and Quantitative Analysis, Cambridge University Press, vol. 45(2), pages 535-553, April.
    16. Gabrielle Berman & Robert Brooks & Sinclair Davidson, 2000. "The Sydney Olympic Games announcement and Australian stock market reaction," Applied Economics Letters, Taylor & Francis Journals, vol. 7(12), pages 781-784.
    17. Martin Mirman & Rajneesh Sharma, 2010. "Stock market reaction to Olympic Games announcement," Applied Economics Letters, Taylor & Francis Journals, vol. 17(5), pages 463-466.
    18. Pandey, Dharen Kumar & Kumari, Vineeta, 2021. "Event study on the reaction of the developed and emerging stock markets to the 2019-nCoV outbreak," International Review of Economics & Finance, Elsevier, vol. 71(C), pages 467-483.
    19. John M. Griffin & Patrick J. Kelly & Federico Nardari, 2010. "Do Market Efficiency Measures Yield Correct Inferences? A Comparison of Developed and Emerging Markets," The Review of Financial Studies, Society for Financial Studies, vol. 23(8), pages 3225-3277, August.
    20. Bana Abuzayed, 2013. "Sport and emerging capital markets: market reaction to the 2022 World Cup announcement," International Journal of Islamic and Middle Eastern Finance and Management, Emerald Group Publishing Limited, vol. 6(2), pages 122-141, June.
    21. Bryan Engelhardt & Victor Matheson & Alex Yen & Maxwell Chisholm, 2017. "The Economic Impact of Olympic Games: Effects of Host Country Announcements on Stock Market Returns," Working Papers 1704, College of the Holy Cross, Department of Economics.
    22. Ardalan, Kavous, 2018. "Neurofinance versus the efficient markets hypothesis," Global Finance Journal, Elsevier, vol. 35(C), pages 170-176.
    23. Madhu Sehrawat & A.K. Giri, 2017. "A Sectoral Analysis of the Role of Stock Market Development on Economic Growth: Empirical Evidence from Indian Economy," Global Business Review, International Management Institute, vol. 18(4), pages 911-923, August.
    24. Rudra P. Pradhan & Mak B. Arvin & Neville R. Norman & John H. Hall, 2014. "The dynamics of banking sector and stock market maturity and the performance of Asian economies," Journal of Economic and Administrative Sciences, Emerald Group Publishing Limited, vol. 30(1), pages 16-44, May.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Harjito, Dwipraptono Agus & Alam, Md. Mahmudul & Dewi, Rani Ayu Kusuma, 2021. "Impacts of International Sports Events on the Stock Market: Evidence from the Announcement of the 18th Asian Games and 30th Southeast Asian Games," OSF Preprints 4dgne, Center for Open Science.
    2. Amélie Charles & Olivier Darné, 2016. "Stock market reactions to FIFA World Cup announcements: An event study," Economics Bulletin, AccessEcon, vol. 36(4), pages 2028-2036.
    3. Krystian M. Zawadzki & Marcin Potrykus, 2023. "Stock Markets’ Reactions to the Announcement of the Hosts. An Event Study in the Analysis of Large Sporting Events in the Years 1976–2032," Journal of Sports Economics, , vol. 24(6), pages 759-800, August.
    4. ATM Adnan & Sameer Al Johani, 2023. "Stock Market Reaction to COVID-19: A Cross-Sectional Industry Analysis in Frontier Market," IIM Kozhikode Society & Management Review, , vol. 12(2), pages 157-181, July.
    5. Adrian R. Bell & Chris Brooks & David Matthews & Charles Sutcliffe, 2012. "Over the moon or sick as a parrot? The effects of football results on a club's share price," Applied Economics, Taylor & Francis Journals, vol. 44(26), pages 3435-3452, September.
    6. Alper Veli ÇAM, 2015. "The Effects of Sporting Success on Stock Returns: An Application in Istanbul Stock Exchange," Journal of Economics Library, KSP Journals, vol. 2(3), pages 147-154, September.
    7. J. K. Ashton & B. Gerrard & R. Hudson, 2011. "Do national soccer results really impact on the stock market?," Applied Economics, Taylor & Francis Journals, vol. 43(26), pages 3709-3717.
    8. Jerome Geyer-Klingeberg & Markus Hang & Matthias Walter & Andreas Rathgeber, 2018. "Do stock markets react to soccer games? A meta-regression analysis," Applied Economics, Taylor & Francis Journals, vol. 50(19), pages 2171-2189, April.
    9. M.R. van den Berg & M. de Nooij, 2013. "The bidding paradox: why economists, consultants and politicians disagree on the economic effects of mega sports events but might agree on their attractiveness," Working Papers 13-08, Utrecht School of Economics.
    10. Gaffeo, Edoardo & Molinari, Massimo, 2017. "Taxing financial transactions in fundamentally heterogeneous markets," Economic Modelling, Elsevier, vol. 64(C), pages 322-333.
    11. Seung-Jin Han & Won-Jae Lee & So-Hee Kim & Sang-Hoon Yoon & Won Shick Ryu & Hyunwoong Pyun & Daehwan Kim, 2022. "Effects of the Olympic Announcement and the Actual Event on Property Values: The Case of the 2018 PyeongChang Winter Olympic Games," Sustainability, MDPI, vol. 14(14), pages 1-16, July.
    12. Truong, Quang-Thai & Tran, Quynh-Nhu & Bakry, Walid & Nguyen, Duc Nguyen & Al-Mohamad, Somar, 2021. "Football sentiment and stock market returns: Evidence from a frontier market," Journal of Behavioral and Experimental Finance, Elsevier, vol. 30(C).
    13. Robert Baumann & Victor Matheson, 2018. "Mega‐Events And Tourism: The Case Of Brazil," Contemporary Economic Policy, Western Economic Association International, vol. 36(2), pages 292-301, April.
    14. Roberto Gásquez & Vicente Royuela, 2014. "Is Football an Indicator of Development at the International Level?," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 117(3), pages 827-848, July.
    15. Mishra, Vinod & Smyth, Russell, 2010. "An examination of the impact of India's performance in one-day cricket internationals on the Indian stock market," Pacific-Basin Finance Journal, Elsevier, vol. 18(3), pages 319-334, June.
    16. Maria Teresa Medeiros Garcia & Tiago Miguel Batista Raimundo, 2024. "The Impact of Player Transfers on European Football Clubs Stock Prices: An Event Study Analysis," Working Papers REM 2024/0361, ISEG - Lisbon School of Economics and Management, REM, Universidade de Lisboa.
    17. Saggu, Aman & Ante, Lennart & Demir, Ender, 2024. "Anticipatory gains and event-driven losses in blockchain-based fan tokens: Evidence from the FIFA World Cup," Research in International Business and Finance, Elsevier, vol. 70(PA).
    18. Fakhrul Hasan & Basil Al-Najjar, 2024. "Exploring the connections: Dividend announcements, stock market returns, and major sporting events," Review of Quantitative Finance and Accounting, Springer, vol. 63(3), pages 889-923, October.
    19. Ogawa, Ryoh, 2017. "Using REIT Data to Assess the Economic Worth of Mega-Events: The Case of the 2020 Tokyo Olympics," MPRA Paper 78829, University Library of Munich, Germany.
    20. Zawadzki, Krystian, 2013. "The impact of mega sports events on the stock markets," MPRA Paper 44467, University Library of Munich, Germany.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:osf:osfxxx:4dgne_v1. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: OSF (email available below). General contact details of provider: https://osf.io/preprints/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.