Mohamed Zakaria

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Mohamed Zakaria
Ph.D. candidate
Islamic Economics & Finance
Sakarya University, Türkiye.
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    Ph.D. Student
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The Impact of Unanticipated Political Events on Stocks Market Returns: Empirical Evidence from Saudi Arabia

July 7, 2022


This study aims to identify the effect of unexpected political-events on Saudi stock market returns based on the efficient market hypothesis (EMH) assumptions. The disappearance of the Saudi journalist Jamal Khashoggi in Turkey is the political event determined in this study. The data collected from ten companies traded in the Saudi stock market accounted for more than 62 percent of the total market capitalization. However, this paper applied the Event Study Methodology. The results showed that the Saudi stock market initially reacted to the event and tried to absorb the information received but could not correct itself in most of the window event period. The market did not get the relevant news quickly or clearly. So, the information that flowed among traders was not readily available to the investors at the same level and time. Ultimately, the Saudi stock market is described as a weak-form market (inefficient).

Keywords: Unanticipated political events, the stock market, expected returns, abnormal returns, cumulative returns, event study methodology.

Article Details

  • Journal Name: International Journal of Islamic Business Ethics (IJIBE)
  • Primary Language: English
  • Subjects: Business, Finance
  • Journal Section: Islamic Business Ethics
  • Author/s: Mohamed Zakaria FODOL (Primary Author)
  • Author Affiliation: Sakarya University
  • ORCID: 0000-0002-8935-4846
  • Publication Date: 2019/10/2
  • Acceptance Date: N/A
  • Published in Issue: 2, Volum 4


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