Effect of semi-annual earning announcement on share price performance of financial service firms listed at the Nairobi stock exchange

Abstract

he Efficient market hypothesis EMH concept states that a market is efficient if security prices immediately and fully adjust to reflect all available information. One of the information that affects share price reaction is earning announcement.Thus the study analyzed the effect of semi-annual earnings announcement on share price responsiveness of financial firms listed at NSE. This was specifically analyzed through the following specific objectives: To determine the effect of pre-earning announcement on the share price performance of financial firms listed at NSE; to determine the effect of post earnings announcement on share price performance on financial services firms, to determine the effect of earning announcement date on financial services firms listed at NSE. The study adopted an event study methodology. The study target population comprised of 17 companies in both insurance and banking industry. Census sampling was used to select all the companies in insurance and banking industry.