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

This paper 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 abn...

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Bibliographic Details
Published in:International journal of sport finance 2021-08, Vol.16 (3), p.139-147
Main Authors: Harjito, Dwipraptono Agus, Alam, Md. Mahmudul, Dewi, Rani Ayu Kusuma
Format: Article
Language:English
Subjects:
Asia
Developing countries
Economic development
Economic growth
Economics and Finance
Efficiency
Efficient markets
Financial markets
GDP
Gross Domestic Product
Host country
Humanities and Social Sciences
Hypotheses
Indonesia
Industrial efficiency
Industrialized nations
Information systems
International
Investments
Investors
LDCs
Philippines
Prices
Professional sports
Securities markets
Soccer
Sports franchises
Stock exchanges
Stock-exchange
Stocks
Subsidies
Tourism
Tournaments & championships
Volatility
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Summary:This paper 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 Southeast Asian 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 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.
ISSN:1558-6235
1930-076X
1930-076X
DOI:10.32731/IJSF/163.082021.03