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Information technology and its impact on stock returns and trading volume
Author(s) -
Benzion Uri,
Tavor Tchai,
Yagil Joseph
Publication year - 2010
Publication title -
international journal of finance and economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.505
H-Index - 39
eISSN - 1099-1158
pISSN - 1076-9307
DOI - 10.1002/ijfe.397
Subject(s) - stock (firearms) , trade volume , abnormal return , phenomenon , stock market , event study , stock trading , economics , financial economics , business , monetary economics , stock exchange , finance , international economics , engineering , geography , mechanical engineering , context (archaeology) , physics , archaeology , quantum mechanics
Abstract This study investigates the impact of information technology on common stock returns and trading volume. By focusing mainly on the peak period of the hi‐tech phenomenon, the findings imply that the market response to website launching is positive. During the event day and the two preceding days, the abnormal stock return and the abnormal trading volume both are positive and statistically significant. In particular, the impact is stronger for non‐US firms than for domestic companies, for initial rather than subsequent site launches, for those sites that are launched on Monday rather than on other days of the week, and for innovative industries such as electronics and computers. As expected, while the launch of a website had a stronger effect at the beginning of the hi‐tech phenomenon, the impact has diminished in later years. Copyright © 2009 John Wiley & Sons, Ltd.