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View from practice: stock market reaction to sukuk credit rating changes in Malaysia

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dc.contributor.authorMahmoud Al Homsi
dc.contributor.authorShamsher Mohamad Ramadili Mohd
dc.contributor.authorZulkarnain Muhamad Sori
dc.date.accessioned2019-11-11T07:36:30Z
dc.date.available2019-11-11T07:36:30Z
dc.date.issued2019
dc.description.abstractDocumented evidence on conventional bond markets shows negative market reaction to bond credit rating downgrade and no reaction to credit rating upgrade. Despite the fact that sukuk issuances make up more than 58.8% of the value of outstanding bonds in the country and Malaysia issues at least half of the world's sukuk and is widely recognized as a leader in the sukuk space, there is no documented evidence on the stock market reaction to sukuk credit rating changes. This study analyzed the wealth effect of sukuk credit rating changes in Malaysia using 16 sukuk upgrades and 20 sukuk downgrades for the period 2000-2014. The evidence shows negative market reaction to downgrades and positive significant reaction to sukuk rating upgrade. This symmetrical market reaction to sukuk credit rating changes implies the market was indifferent between bonds and sukuk from the credit rating perspective. This finding supports the notion that the credit rating agencies are Shariah-neutral when rating these capital market instruments.en_US
dc.identifier.citationMuhamad Sori, Z., & Ramadili Mohd, S. M., & Al Homsi, M. (2019). View from practice: stock market reaction to sukuk credit rating changes in Malaysia. Thunderbird International Business Review, 61(5), 659-667. https://doi.org/10.1002/tie.22066en_US
dc.identifier.doihttps://doi.org/10.1002/tie.22066
dc.identifier.issn1520-6874
dc.identifier.urihttps://ikr.inceif.org/handle/INCEIF/3130
dc.languageEnglish
dc.language.isoengen_US
dc.publisherWileyen_US
dc.rights2019. Wiley
dc.sourceSEDONA
dc.subjectCredit ratingsen_US
dc.subjectIslamic financeen_US
dc.subjectMarket reactionen_US
dc.subjectSukuken_US
dc.subjectWealth effecten_US
dc.titleView from practice: stock market reaction to sukuk credit rating changes in Malaysiaen_US
dc.typeJournal Articleen_US
dlc.maintopicIslamic capital marketsen_US
dspace.entity.typePublication
ikr.doctypeScholarly Works
ikr.topic.maintopicIslamic capital marketsen_US
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