Impact of Government Budget Announcement on Stock Market Sector Indices: Evidence from Colombo Stock Exchange
Journal of Finance and Accounting
Volume 5, Issue 6, November 2017, Pages: 214-218
Received: Oct. 23, 2017; Accepted: Nov. 20, 2017; Published: Dec. 23, 2017
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Author
Udani Chathurika Edirisinghe, Department of Accountancy & Finance, Faculty of Management Studies, Sabaragamuwa University of Sri Lanka, Belihuloya, Sri Lanka
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Abstract
This study attempts to investigate the impact of Sri Lankan government budget announcements on five sector indexes of Colombo Stock Exchange, namely banks, finance & insurance; beverage, food & tobacco; manufacturing; motor; diversified holdings. The Event study methodology was used to analyze sector wise stock price behavior during the sample period of 2002 to 2013. Results revealed that although the overall trend of the average returns of each sector around budget announcements are same the magnitude of the reaction is different from sector to sector. Motor was the mostaffected sector and diversified holdings sector was the least affected.
Keywords
Government Budget, Sector Indexes, Average Returns
To cite this article
Udani Chathurika Edirisinghe, Impact of Government Budget Announcement on Stock Market Sector Indices: Evidence from Colombo Stock Exchange, Journal of Finance and Accounting. Vol. 5, No. 6, 2017, pp. 214-218. doi: 10.11648/j.jfa.20170506.12
Copyright
Copyright © 2017 Authors retain the copyright of this article.
This article is an open access article distributed under the Creative Commons Attribution License (http://creativecommons.org/licenses/by/4.0/) which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
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