STOCK MARKET RESPONSE TO PFIZER AND BIONTECH’S SUCCESSFUL VACCINE DEVELOPMENT ANNOUNCEMENT: AN EVENT STUDY ANALYSIS IN THAILAND
DOI:
https://doi.org/10.14456/aamr.2024.24Keywords:
CAAR, Pfizer, BioNTech, Vaccine Development Announcement, Sector IndexAbstract
This study investigates the stock market in Thailand in response to Pfizer and BioNTech's announcement of successful vaccine development in phase III. The event study methodology analyzes such responses through cumulative abnormal returns of 28 sector indices. The result showed that the overall CAAR experienced significant cumulative abnormal returns during the announcement period. Agribusiness and personal care and pharmaceutical sector indices were found to be significantly negative. In contrast, property development, automobile, and healthcare service sector indices were significantly positive. In addition, cumulative abnormal returns exhibited insignificance for the post-announcement period. It is suggested that investors cannot make an abnormal return consistently because the market adjusted to its balances.
References
Amalia, F. (2022). The impact of covid-19 outbreak on Indonesia Tourism Stock Perfor-mance. Jurnal Industri Pariwisata, 5(1), 79-89.
Awijen, H., Zaied, Y., & Nguyen, D. (2022). Covid-19 vaccination, fear and anxiety: Evi-dence from google search trends. Social Science & Medicine, 297, 114820.
Borad, S. (2023). Efficient market hypothesis-all you need to know. Retrieved from https://efinancemanagement.com/investment-decisions/efficient-market-hypothesis.
Brothers, W. (2020). A timeline of COVID-19 vaccine development. Retrieved from www.biospace.com/article/a-timeline-of-covid-19-vaccine-development.
Brown, S., & Warner, J. (1985). Using daily stock returns. Journal of Financial Economics, 14(1), 3-31.
Business Today. (2020). “STGT-STA” stock price declined after successful vaccine develop-ment. Retrieved from www.businesstoday.co/stock/11/11/2020/53970.
Chan, K., Chen, Z., Wen, Y., & Xu, T. (2021). Covid-19 vaccines: Saving lives and the global stock markets. Retrieved from https://ssrn.com/abstract=3785533.
Cross, R. (2020). Pfizer, BioNTech say their COVID-19 vaccine is successful in late-stage trial. C&EN Global Enterprise, 98(44), 12-12.
Dodd, P., & Warner, J. (1983). On corporate governance: A study of proxy contests. Journal of Financial Economics, 11(1-4), 401-438.
Econ Digest. (2020). Despite Vaccines on the Horizon, the World Still Needs Over 2.35 Tril-lion Medical Gloves. Retrieved from www.kasikornresearch.com/th/analysis/k-social-media/Pages/Glove-FB-28-12-20.aspx#_ftn1.
Endri, E., Aipama, W., Razak, A., Sari, L., & Septiano, R. (2021). Stock price volatility dur-ing the COVID-19 pandemic: The GARCH model. Investment Management and Fi-nancial Innovations, 18(4), 12-20.
Fadda, M., Albanese, E., & Suggs, S. (2020). When a COVID-19 vaccine is ready, will we all be ready for it?. International Journal of Public Health, 65(6), 711-712.
Giglio, S., Maggiori, M., Stroebel, J., & Utkus, S. (2021). The joint dynamics of investor be-liefs and trading during the COVID-19 crash. Proceedings of the National Academy of Sciences, 118(4), e2010316118.
Guerrero, F., Papadovasilaki, D., Ridinger, G., & Sundali, J. (2021). Investor beliefs in the midst of a market crash and the covid 19 pandemic: Survey and experimental evi-dence. Decision, 8(4), 295-326.
Hartono, H. (2021). Covid-19 vaccine: Global Stock Market “Game changer”. Journal of Asian Multicultural Research for Economy and Management Study, 2(2), 8-17.
Henley, J. (2020). Coronavirus causing some anti-vaxxers to waver, experts say. Retrieved from www.theguardian.com/world/2020/apr/21/anti-vaccination-community-divided-how-respond-to-coronavirus-pandemic.
InfoQuestNews. (2020). STGT-Rubber group experiences consecutive declines, expected to shift investment groups after COVID vaccine progresses. Retrieved from www.ryt9.com/s/iq05/3174.
Jabeen, S., Farhan, M., Zaka, M., Fiaz, M., & Farasat, M. (2022). Covid and world stock markets: A comprehensive discussion. Frontiers in Psychology, 12, 763346.
Ji, X., Bu, N., Zheng, C., Xiao, H., Liu, C., Chen, X., & Wang, K. (2022). Stock market reac-tion to the COVID-19 pandemic: An event study. Portuguese Economic Journal, 23(1), 167-186.
Kanchanawisut, K. (2021). Thai Rubber Gloves: Opportunities in 2021 and Challenges Post-COVID-19. Retrieved from www.scbeic.com/th/detail/product/7565.
Kapar, B., Buigut, S., & Rana, F. (2022). Winners and losers from Pfizer and Biontech’s vac-cine announcement: Evidence from S&P 500 (sub)sector indices. PLoS ONE, 17(10), e0275773.
Kewei, X., & Yuanyuan, L. (2020). A-share stock reactions to the approval of COVID-19 Vaccine Clinical Trial: An Event Study Model of listed pharmaceutical firms’ returns. A paper presented at the 2nd International Conference on Economic Management and Model Engineering, Chongqing, China.
Kiruba, A., & Vasantha, V. (2021). Determinants in investment behaviour during the COVID-19 pandemic. Indonesian Capital Market Review, 13(2), Article 1.
Kumar, P. (2021). Investors cool on Malaysian gloves stocks on Vaccine Drive. Retrieved from https://asia.nikkei.com/Spotlight/Coronavirus/Investors-cool-on-Malaysian-gloves-stocks-on-vaccine-drive.
Latimer, K. (2020). About 20% of people in recent survey said they wouldn’t take covid-19 vaccine | CBC News. Retrieved from www.cbc.ca/news/canada/saskatchewan/covid-survey-first-round-results-1.5541053.
Liew, V., & Puah, C. (2020). Chinese Stock Market Sectoral Indices Performance in the Time of Novel Coronavirus Pandemic. Retrieved from www.researchsquare.com/article/rs-29363/v1.
Lin, X., Hagsten, E., & Falk, M. (2022). Stock market performance of the US hospitality and tourism during the COVID-19 pandemic. Tourism Analysis, 27(4), 567-574.
Machmuddah, Z., Utomo, D., Suhartono, E., Ali, S., & Ghulam, W. (2020). Stock market re-action to COVID-19: Evidence in customer goods sector with the implication for open innovation. Journal of Open Innovation: Technology, Market, and Complexity, 6(4), 99.
Mahase, E. (2020). Covid-19: Pfizer and BioNTech Submit Vaccine for us authorisation. BMJ, 371, m4552.
Mullin, R. (2020). Pfizer, Moderna Ready Vaccine Manufacturing Networks. C&EN Global Enterprise, 98(46), 12-12.
Naseem, S., Mohsin, M., Hui, W., Liyan, G., & Penglai, K. (2021). The investor psychology and stock market behavior during the initial era of COVID-19: A study of china, Ja-pan, and the United States. Frontiers in Psychology, 12, 626934.
Nugraha, A., Hakimah, Y., & Fawzi, A. (2022). Covid-19 pandemic and performance of In-donesian Stock Market: An Event Study Analysis. Jurnal Economia, 18(2), 204-220.
Oanh, T. (2022). The impact of covid-19 vaccination on stock market: Is there any difference between developed and developing countries?. Heliyon, 8(9), e10718.
Oncu, E. (2021). The impact of COVID-19 on Health Sector Stock Returns. In Administra-tive, Economics and Social Sciences Theory, Current Researches and New Trends 2021 (pp. 109-121). Cetinje: IVPE.
Ozkan, O. (2021). Impact of covid-19 on stock market efficiency: Evidence from developed countries. Research in International Business and Finance, 58, 101445.
Pacicco, F., Vena, L., & Venegoni, A. (2018). Event study estimations using Stata: The es-tudy command. The Stata Journal, 18(2), 461-476.
Parveen, S., Satti, Z., Subhan, Q., Riaz, N., Baber, S., & Bashir, T. (2021). Examining inves-tors’ sentiments, behavioral biases and investment decisions during COVID-19 in the emerging stock market: A case of pakistan stock market. Journal of Economic and Administrative Sciences, 39(3), 549-570.
Pfizer. (2020). Pfizer and BioNTech Announce Vaccine Candidate Against COVID-19 Achieved Success in First Interim Analysis from Phase 3 Study. Retrieved from www.pfizer.com/news/press-release/press-release-detail/pfizer-and-biontech-announce-vaccine-candidate-against.
Phokkachai, T. (2021). Hospital Group Stocks: A Bright Future Ahead. Retrieved from www.setinvestnow.com/th/knowledge/article/165-the-recovering-future-of-medical-service-stocks-after-covid19-crisis.
Prucksakorn, N., & Sukcharoensin, P. (2021). The Impact of the Covid-19 Outbreak on Thai-land Industries: An Event-Study Approach. Bangkok: National Institute of Develop-ment Administration.
Salisbury, I. (2020). As COVID-19 vaccine news boosts the stock market, here are the biggest winners (and losers). Retrieved from https://money.com/covid-vaccine-stock-market-winners-losers.
Singh, B., Dhall, R., Narang, S., & Rawat, S. (2024). The Outbreak of COVID-19 and Stock Market Responses: An Event Study and Panel Data Analysis for G-20 Countries. Global Business Review, 25(3), 606-631.
Tanne, J. (2020). Covid-19: Pfizer-biontech vaccine is rolled out in US. BMJ, 371, m4836.
Tardi, C. (2023). Rational expectations theory definition and how it works. Retrieved from www.investopedia.com/terms/r/rationaltheoryofexpectations.asp.
Tashanova, D., Sekerbay, A., Chen, D., Luo, Y., Zhao, S., & Zhang, Q. (2020). Investment opportunities and strategies in an ERA of coronavirus pandemic. Retrieved from http://dx.doi.org/10.2139/ssrn.3567445.
Trishana, C. (2022). Impact of vaccine manufacturing announcement during pandemic on the stock market reaction of pharmaceutical companies. Journal of Social Science, 3(1), 39-53.
Vasileiou, E. (2021). Efficient markets hypothesis in the time of COVID-19. Review of Eco-nomic Analysis, 13(1), 45-63.
Virdikar, B., & Kulkarni, M. (2022). A study on stock market investors during COVID phase-prospect theory approach. Cardiometry, (23), 263-271.
Downloads
Published
How to Cite
Issue
Section
License
Copyright (c) 2024 Authors
This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.
.png)
