The effect of announcing the accounting information contained in the annual financial reports on the prices and trading volume of shares in the Amman Stock Exchange

Abstract

This study aimed to measure the effect of announcing the accounting information contained in the annual financial reports on the prices and volume of stock trading for a sample of 45 companies listed in the Amman market distributed over the four main sectors (banks, industrial insurance, services for the period 2005-2007), and at the same time testing the efficiency of Amman Stock Exchange (pricing efficiency) in the semi-average form towards the accounting information contained in these reports, using the event study method.
The study concluded:
First: There is no significant effect of the announcement of the computer information contained in the annual financial reports on the share prices of the sample companies (together on the day of the event, and then the share prices do not reflect clearly and quickly the accounting information (as the most important type of public information available), which indicates the inefficiency of the Amman market For securities in the semi-strong format.
Secondly, there is a significant effect of announcing the accounting information contained in the annual financial reports on the trading volumes (number) of shares in the Amman market, expressed in the extraordinary volume of trading on the day of the event, and the continuity of this effect or reaction for the two days following the day of the event, which indicates the importance and impact of accounting information in Stock market.