Sweden's Stock Prices React Strongly to Earnings Disclosures, Boosting Investor Confidence
The article examines how earnings disclosures affect share prices in Sweden from 2001 to 2014. By analyzing abnormal returns and earnings response coefficients, the study found that the stock price changes are closely related to the announced earnings. This supports the idea that earnings have a significant impact on share prices, confirming the value relevance theory in accounting. The findings suggest that investors pay close attention to earnings disclosures when making decisions about buying or selling stocks.