Political News and Stock Returns: A Case of Pakistan

Faria Shamas , Muneeb Ahmad and Usman Khalid

Abstract

We analyze the influence of political news on the stock market returns for Pakistan. The data are daily and covers 5th June 2013 to 30 March 2018. Political news is viewed as procurators political instability which in turn predict market fluctuations. Consistent with our expectations, by employing MGARCH analysis, we find that political news has a distinct effect on stock returns and have a significant negative effect on the stock returns.
Keywords: Political New, Market Fluctuations, Stock Returns