The Impact of Election on Stock Market Returns of Government-Owned Banks: The Case of Indonesia, Malaysia and Thailand (original) (raw)

A political event –presidential election has always been an attractive event for both domestic and foreign investors, as one of the event that bring a significant impact to the country’s stability and is to determine a new direction of the government for the following period. This research analyzes whether the presidential election in Indonesia have any effect on the stock performance on Indonesia Stock Exchange (IDX). The variables used in the analysis include abnormal return and trading volume activity, of which are collected from the IDX and annual reports. This research uses the event study approach, and includes all the direct presidential elections in Indonesia. The hypothesis testing includes non parametric tests of One-Sample Wilcoxon Signed Ranks and Two-Sample Wilcoxon Signed Ranks, with a 10-day event period before and after the event. The sample data is taken using the purposive sampling method from all public companies listed in IDX, of which resulted to the ones includ...

The 2018 Malaysia general election has marked a new history for the Malaysia political structure. After more than 60 years Barisan Nasional ruling the country, in the 2018 general election Barisan Nasional lose the game to the Pakatan Harapan. The results of the 14th general election has caused a shock not only to political arena but also to the Malaysian financial market. Therefore, this paper aims to investigate if there is any significant effect of 14th Malaysia general election on the Malaysia financial market specifically the stock market. Results from the statistical analysis reveal that there are significant changes in the Malaysia stock market performance after the 14th general election.

This study aims to analyze the developments of macroeconomic, financial performance and stock returns and to analyze how macroeconomic influence directly and indirectly through the financial performance on the stock return of state-owned banks in the Indonesia Stock Exchange period 2006 to 2016. Macroeconomic variables used are the interest rate (SB), exchange rate (NT) and Gross Domestic Product (GDP). Financial performance variables used are Capital Adequacy Ratio (CAR), Non Performing Loan (NPL), Operating Expenses to Operating Income (BOPO) and Loan to Deposit Ratio (LDR). The analysis technique used in this research is path analysis, using SPSS and Lisrel software. The results found in this study are development of macroeconomic variables, financial performance and stock returns four state-owned banks showed positive value. Directly, interest rate has a significant impact on stock returns of Bank Mandiri and BNI, the exchange rate has a significant impact on stock returns of BT...

This study examines the effect of the announcement of the central bank of Indonesia rates (BI-rate) increase in 2013 on stock prices of banking sector at Indonesian Stock Exchange. During the year 2013, Bank Indonesia has increased six times BI-rate. The study uses the event study framework on a total of 28 public banks. Results show that there are significant abnormal returns in the period prior to the announcement, on the announcement date, and after the announcement of the BIrate increases. It also documents significant difference of abnormal returns between before and after the event date. Overall, the announcements of interest rates increases significantly affect the banks’ stock prices.

This research aims to examine the impacts of Indonesia’s 2014 presidential election towards stock prices on Indonesia Stock Exchange. Samples used were the companies included in LQ-45 from February 2014 to July 2014. This research took abnormal stock return and trading volume activity to be examined. Event study was used as the research model. The result shows that there is abnormal return for each event during presidential election. However, there is no significant difference before and after the event for both abnormal return and trading volume activity.

This paper investigates the impact of parliamentary general election on the stock market returns by considering the previous fifteen days and the after fifteen days of each of six elections in Bangladesh held between 1991 and 2018. The study analyzed the election effect on stock returns through considering both abnormal returns by choosing 20 stocks as a proxy of portfolio motive of the investors and the broad index returns as a measurement of whole market scenario. The study employed descriptive statistics, t-tests, and F-tests to understand the impact of election by gauging the changes in return series. Descriptive statistics showed very high differences in means, standard deviations, and volatilities. Paired t-tests showed significant differences between the means and F-tests showed significant differences between the variances of the returns during before and after days of these elections. The results were the same for abnormal returns and broad index returns. The impacts of individual election on the returns were also found as the same in most cases. The study has found some very useful insights part of which can benefit the policymakers to reform the policies. The common investors and the financial market participants can also make better investment plan.