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Impact of Islamic Events on Stock Market: Evidence from Karachi Stock Exchange of Pakistan
Current Issue
Volume 2, 2015
Issue 6 (November)
Pages: 63-66   |   Vol. 2, No. 6, November 2015   |   Follow on         
Paper in PDF Downloads: 61   Since Sep. 29, 2015 Views: 1684   Since Sep. 29, 2015
Authors
[1]
Muazzam Ali, Faculty of Management Science, Lahore Leads University Pakistan, Lahore, Pakistan.
[2]
Shakeel Ahmad Khan, Faculty of Management Science, Lahore Leads University Pakistan, Lahore, Pakistan.
[3]
Abubakar , Faculty of Commerce, Allama Iqbal Open University Pakistan, Islamabad, Pakistan.
Abstract
Religious belief plays an important role in lives, behavior, and decision making of the people. Religious values and practice have a significant effect on economic growth (Weber 1930). Purpose of this study is to address the impact of Islamic events on stocks. This study sets out to explore this impact in Karachi Stock Exchange of Pakistan. Specifically, it investigates how religious events impact stock market’s trading volume and return around religious holy days in Muslim countries. The study focuses on Islamic events like Eid-ul-Fiter etc. As we know that stock markets of any country plays a vital role in elaborating the economic condition of that country. That’s why this study has great importance in its nature. This study will explore that either stocks gives “Capital Gains” on specific “Islamic Events” to the investors or not. This study will be helpful for investors to take better decision for their investments in stocks on these events. This paper attempts to investigate the impact of Islamic events on stocks in the Karachi Stock Exchange, Pakistan. Islamic events like Eid-ul-Fiter etc. affect the behavior of stock markets in Muslim countries like Pakistan, where the environment on Eid-ul-Fiter is different from whole year because Eid-ul-Fiter is followed by Ramadan, the holy month of fasting, and people give over more time to perform religious ceremony and the general economic activity slows down. So in this study, we will find out: Mean return and stock returns volatility around Eid days. Comparison of both, the return before and after the Eid etc.
Keywords
Eid-ul-Fiter, Economic Growth, Stock Exchange, Stock Returns, Volatility
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