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Investor Sentiment, Financing Constraints, and Earnings Persistence.

Investor Sentiment, Financing Constraints, and Earnings Persistence.

Authors :
Chunhui You
Jing Wang
Source :
Emerging Markets Finance & Trade; May2024, Vol. 60 Issue 6, p1148-1161, 14p
Publication Year :
2024

Abstract

Based on the background of investor sentiment volatility in the capital market, this article empirically examines the relationship between investor sentiment and corporate earnings persistence and its impact mechanism using a first-order autoregressive model with a sample of Chinese A-share non-financial listed companies from 2007 to 2019. It is found that rising investor sentiment helps improve corporate earnings persistence when investor sentiment is moderate, with financing constraints playing a part in mediating the effect. The test of heterogeneity in corporate life cycle and nature of ownership found that rising investor sentiment significantly mitigates the financing constraints in growth stage and non-state enterprises, which in turn improves their earnings persistence. [ABSTRACT FROM AUTHOR]

Details

Language :
English
ISSN :
1540496X
Volume :
60
Issue :
6
Database :
Complementary Index
Journal :
Emerging Markets Finance & Trade
Publication Type :
Academic Journal
Accession number :
177479525
Full Text :
https://doi.org/10.1080/1540496X.2023.2284307