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A Peer-reviewed scientific articles/A1 Journal article (refereed), original research
      
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Does the Type of Debt Matter? Stock Market Perception in Europe, Quarterly Review of Economics and Finance (Forthcoming). Fungáčová, Zuzana; Godlewski, Christophe; Weill, Laurent


Category A Peer-reviewed scientific articles
Sub-category A1 Journal article (refereed), original research
auki Internal authors
All authors as text Fungáčová, Zuzana; Godlewski, Christophe; Weill, Laurent 
Number of authors
Status Forthcoming
Year of publication 2019 
Date 10.04.2019 
Name of article Does the Type of Debt Matter? Stock Market Perception in Europe 
Name of journal Quarterly Review of Economics and Finance
Abstract We study the effect of syndicated loan and bond announcements on the stock price of borrowers. No work since James (1987) on US data has compared the impact of both types of announcements on the same sample. Applying an event study methodology on a sample of companies from 17 Western European countries, we find that debt announcements tend to generate a positive stock market reaction. Our main conclusion is that loan issuance exerts a significantly stronger reaction than a bond issuance. This finding supports the hypothesis that loan issuance has a positive certification effect. The analysis of determinants of abnormal returns following debt announcements shows a positive impact for financial development and a negative effect for the Eurozone crisis.
Free text descriptor in Finnish yritykset; luotot; joukkovelkakirjat; osakkeet; hinnat; tuotot; Eurooppa 
Free text descriptor in English corporate bonds, syndicated loans, event study, stock returns, Europe 
JEL-codes G14, G20 
ISSN / e-ISSN 1062-9769