Market uncertainty and the importance of media coverage at earnings announcements

• 成果类型: Article
• 署名作者: Bonsall, Samuel B.; Green, Jeremiah; Muller, Karl A., III
• 署名单位: Pennsylvania Commonwealth System of Higher Education (PCSHE); Pennsylvania State University; Pennsylvania State University - University Park; Texas A&M University System; Texas A&M University College Station
• 刊物名称: JOURNAL OF ACCOUNTING & ECONOMICS
• ISSN/ISSBN: 0165-4101
• DOI: 10.1016/j.jacceco.2019.101264
• 发表日期: 2020
• 关键词: STOCK-PRICE REACTION; information-content; business press; news; management; liquidity; attention; FIRMS; dissemination; underreaction

摘要

We investigate whether increased investor demand for financial information arising from higher market uncertainty leads to greater media coverage of earnings announcements. We also investigate whether greater coverage during times of higher uncertainty further destabilizes financial markets because of greater attention-based trading or, alternatively, improves trading and pricing by lowering investor acquisition and interpretation costs. When uncertainty is higher, we find evidence of greater media coverage of earnings announcements and that the greater coverage leads to improvements in investor informedness, information asymmetry, and intraperiod price timeliness, and greater trade by both retail and institutional investors. In contrast to the media serving an expanded role in improving capital markets during more uncertain times, we fail to find that changes in firm-initiated disclosures lead to similar improvements and find that less frequent analyst forecast revisions exacerbate problems in capital markets during earnings announcements. (C) 2019 Elsevier B.V. All rights reserved.