AJMR ISSN: 2278-4853 Vol 9, Issue 6, June, 2020 Impact Factor: SJIF 2020 = 6.882 Asian Journal of Multidimensional Research (AJMR) https://tarj.in 1 AJMR ISSN: 2278-4853 Vol 9, Issue 6, June, 2020 Impact Factor: SJIF 2020 = 6.882 Asian Journal of Multidimensional Research (AJMR) https://tarj.in 2 AJMR ISSN: 2278-4853 Vol 9, Issue 6, June, 2020 Impact Factor: SJIF 2020 = 6.882 Published by: TRANS Asian Research Journals AJMR: A sianJournal ofM u l t i d i m e n s i o n a l R e s e a r c h (A Double Blind Refer eed & Reviewed International Journal) SR. PAGE DOI NUMBER P A R T I C U L A R NO. NO AN ESSAY ON REACTION OF STOCK PRICES 1. TO EARNINGS ANNOUNCEMENTS 6-18 10.5958/2278-4853.2020.00214.1 Prof. Iqbal Thonse Hawaldar GENDER POLICY: STEREOTYPES WITH INFLUENCE ON WOMEN'S POSITION 2. 19-26 10.5958/2278-4853.2020.00198.6 Rajapova Natalya Bazarovna, Nazarova Manzura Nasrullaevna SPIRITUAL THREATS IN STUDENTS 3. AGAINST IDEOLOGICAL COMPETENCE 27-32 FORMATION 10.5958/2278-4853.2020.00199.8 Uzokov Akram Avazovich IMPROVEMENT OF TECHNOLOGIES OF 4. ECOLOGICAL EDUCATION OF PUPILS 33-39 10.5958/2278-4853.2020.00200.1 Aydarov Erkin Bakitovich SPECIFIC FEATURES OF USING THE MULTIMEDIA SYSTEM IN THE EDUCATIONAL PROCESS 10.5958/2278-4853.2020.00201.3 5. 40-46 Makhmudova Malokhat Akhmatovna, Nasirova Shaira Narmuradovna, Kholmurodova Zuhra Nishonovna, Karimova Nargiza Abdimuminovna REVIEWING THE BENEFITS OF YOGA AS AN APPROACH OF INDIGENOUS PSYCHOLOGY 6. DURING THE COVID-19 PANDEMIC 47-55 10.5958/2278-4853.2020.00212.8 Rupashree Goswami Asian Journal of Multidimensional Research (AJMR) https://tarj.in 3 AJMR ISSN: 2278-4853 Vol 9, Issue 6, June, 2020 Impact Factor: SJIF 2020 = 6.882 SUPPORT FOR VEHICLE MAINTENANCE 7. 56-58 10.5958/2278-4853.2020.00208.6 Ikromov Ikboljon Abdukhalilovich, Meliyev Hudoyor Obloyorovich ANALYSIS OF DROPLETS SIZE DISTRIBUTION AND INTERFACIAL SURFACE DURING PNEUMATIC 10.5958/2278-4853.2020.00209.8 8. MIXING 59-64 Alimatov B, Khursanov B GENERAL ATLAS 9. 65-69 Habibullaev E. D, Khakimova K.R 10.5958/2278-4853.2020.00210.4 LAW OF INTERDISCIPLINARY RELATIONS IN THE PROCESS OF ECOLOGICAL EDUCATION 10. 70-74 10.5958/2278-4853.2020.00207.4 Kuldosheva Dilsuz Sunnatovna A STUDY ON ENGAGING THE PROBLEMATIC OF GOVERNANCE AND SERVICE DELIVERY 10.5958/2278-4853.2020.00213.X 11. IN DEMOCRATIC NIGERIA 75-92 God’stime Osariyekemwen Igiebor INTERACTIVE GAMES AS A WAY TO IMPROVE SPEECH SKILLS IN FOREIGN 10.5958/2278-4853.2020.00195.0 12. LANGUAGE LESSONS 93-96 Abbosova Zarnigor Abbosovna ON THE COVERAGE OF ETHNIC PROCESSES 13. IN THE INFORMATION SPACE 97-01 10.5958/2278-4853.2020.00197.4 M.M.Sodirjonov SPECIFIC FEATURES OF THE PEDAGOGICAL PROCESS FOCUSED ON INCREASING THE 14. SOCIAL ACTIVITY OF YOUTH 102-07 10.5958/2278-4853.2020.00196.2 Tojiboyeva Khilolaxon Makhmutovna, Tuychiyeva Inoyatkhon Ibragimovna ON THE HISTORIOGRAPHY OF THE TURKIC 15. KAGANATE 108-12 10.5958/2278-4853.2020.00202.5 Buvakov Nosirbek SOCIO-POLITICAL, CULTURAL AND SCIENTIFIC ENVIRONMENT OF THE 16. USTURUSHANA IN X-XI CENTURIES 113-20 10.5958/2278-4853.2020.00203.7 Muzaffar Jabborov Asian Journal of Multidimensional Research (AJMR) https://tarj.in 4 AJMR ISSN: 2278-4853 Vol 9, Issue 6, June, 2020 Impact Factor: SJIF 2020 = 6.882 THE ESTIMATION OF THE IMPACTS OF THE COVID-19 PANDEMIC ON THE 17. MACROECONOMIC INDICATORS SUGG- 121-28 10.5958/2278-4853.2020.00211.6 ESTIONS FOR UZBEKISTAN Akbarali Uralov, Sultonbek Uralov AN ANALYSIS OF JOB SATISFACTION OF EMPLOYEES (A STUDY ON BHEL PUBLIC 18. SECTOR OF UTTARAKHAND) 129-47 10.5958/2278-4853.2020.00215.3 Dr. Hitesh Kumar Pant, Mrs. Anita Tiwari, Dr. Pratibha Pant IDEOLOGICAL INTERPRETATION OF SE- ASONAL AND CEREMONIAL SONGS IN 19. “DĪWĀNLUGHĀT AL-TURK” - “COM- 148-55 PENDIUM OF THE LANGUAGES OF THE 10.5958/2278-4853.2020.00204.9 TURKS” Sattorova Zilola Ismoilovna EXPRESSION OF SEMIOPRAGMATIC CONTENT 20. 156-60 Yuldasheva Zarnigor Hasanboy qizi, 10.5958/2278-4853.2020.00205.0 Qurbonova Mohidil Ulug’bek qizi, Kushakova Shahzodakhon Dilshod qizi NEW DIRECTIONS OF LINGUISTICS THEORY OF SPEECH ACTS 10.5958/2278-4853.2020.00206.2 21. 161-64 Yuldasheva Zarnigor Hasanboy qizi, Qurbonova Mohidil Ulug’bek qizi TOPIC OF RESEARCH PAPER: TEACHING TECHNIQUES AND REFORMS IN HIGHER 10.5958/2278-4853.2020.00216.5 22. EDUCATION FOR ALL 165-71 Poonam EMPLOYEES' VALUE CONGRUENCE AND CREATIVITY: ROLE OF PAY SATISFACTION 23. 172-83 10.5958/2278-4853.2020.00340.7 Ganesh Bhattarai, Dr. Dhruba Raj Pokharel Asian Journal of Multidimensional Research (AJMR) https://tarj.in 5 AJMR ISSN: 2278-4853 Vol 9, Issue 6, June, 2020 Impact Factor: SJIF 2020 = 6.882 Published by: TRANS Asian Research Journals AJMR: A s i a n J o u r n a l o f M u l t i d i m e n s i o n a l R e s e a r c h (A Double Blind Refer eed & Reviewed International Journal) DOI: 10.5958/2278-4853.2020.00214.1 AN ESSAY ON REACTION OF STOCK PRICES TO EARNINGS ANNOUNCEMENTS Prof. Iqbal Thonse Hawaldar* *Professor, Department of Accounting & Finance, College of Business Administration & Director, Accreditation & Quality Assurance Centre, Kingdom University, BAHRAIN Email id: [email protected] ABSTRACT Speed of stock price response is important because if response is slow, the informed and alert investors would exploit it to earn abnormal returns by outperforming the market. This implies that market is inefficient in the semi-strong form. The study tests the reaction Indian stock market reaction to June 2014 quarterly financial results announcement. The study is based on 98 companies. The researcher used event study methodology. The behaviour of average abnormal returns (AARs) and cumulative average abnormal returns (CAARs) are examined for 30 days prior to and 31 days after the announcement of quarterly financial results. Runs test, sign test and t-test statistics on AARs are statistically not significant. However, t-values on CAARs are statistically significant. Therefore, we conclude that Indian stock market is not efficient in the semi-strong form. KEYWORDS: Efficient Market Hypothesis, Event Study, Semi Strong Form Of Efficiency, Stock Market Reaction, Indian Stock Market. INTRODUCTION: An empirical study to test the semi-strong form of efficient market hypothesis examines the speed and accuracy of adjustment of stock prices to release of certain new relevant information. Security prices are expected to respond to the relevant new information as and when it reaches the market. In an efficient market, stock prices reflect available information fully and instantaneously. In other words, efficiency of stock market is reflected in two ways, i.e. speed and accuracy. Speed refers to time taken by the stock to respond to new publicly available relevant information. Woodruff and Senchack (1988) asserted that the adjustment process is Asian Journal of Multidimensional Research (AJMR) https://tarj.in 6 AJMR ISSN: 2278-4853 Vol 9, Issue 6, June, 2020 Impact Factor: SJIF 2020 = 6.882 assumed to be over when the likelihood of continuation (reversal) comes back to the level expected in non-announcement period. A semi-strong form of efficient market is a market in which adjustment of stock prices to new publicly available information is not only rapid, but also accurate, i.e., in the right direction and of right magnitude. There should not be any bias in the adjustment of stock prices to new information and if there is no systematic bias in the adjustments of stock prices to new information, the average price movement will be zero. Therefore, speed and accuracy of stock price adjustment is important to consider any stock market as an efficient market. Both underreaction and overreaction to new price sensitive information would offer an opportunity to investors to systematically beat the market and earn abnormal returns, which is inconsistent with semi-strong form of efficient market hypothesis. REVIEW OF LITERATURE: Patell and Wolfson (1984) investigated the intra-day speed of adjustment of stock prices to earnings and dividend announcement. They selected a sample of 571 earnings and 96 dividend announcements during 1976 to 1977. Patell and Wolfson (1984) measured effects of earnings and dividend announcements on intra-day stock price behaviour around mean returns, return variance, and serial correlation in consecutive price changes. The analysis of the results suggested that price reaction to earnings and dividend announcements begins very quickly. There are many studies, which support the view that stock market is semi-strong form of efficient marked hypothesis. However, there are many empirical studies that questioned the semi-strong of efficient market hypothesis. In efficient market hypothesis literature these studies are commonly called ‗anomalies. According to Ball (1992) ―the anomaly is that estimated future abnormal returns are predicted by public information about future earnings, contained in (i) current earnings and (ii) current financial statement ratios‖ (p.319). There is a consistent anomaly in the behaviour of security prices after the announcement of earnings, dividends, merger and acquisition, stock split, bonus issue, rights issue etc.Brown (1979) examined the adjustment of stock prices to earning per share (EPS) information. The study covered a period from 1963 to 1971 with a sample of 158 firms. He used residual analysis method previously used by Ball and Brown (1968), Brown and Kennelly (1972), Fama et al. (1969), Kaplan and Roll (1970) and Pettit (1972). The analysis of the results suggested that statistically significant cumulative abnormal returns appeared from day 15 to day 45. This indicated that the market failed to adjust instantaneously to the new EPS information and provided an opportunity to earn excess returns on the EPS information after 45 days of announcement.