THE ANNOUNCEMENT IMPACT OF HOSTING THE INTERNATIONAL SPORTING EVENT ON INDONESIA STOCK MARKET AND PHILIPPINE STOCK MARKET BEFORE AND AFTER THE EVENT (Case of XVIII Asian Games and XXX SEA Games)

Abstract

This research was an investigation of the impact of hosting the International Sporting Event on the stock market of the host country before and after the tournament was announced. This research observed XVIII Asian Games announcement with Indonesia as the host country and XXX SEA Games announcement with Philippine as the host country. This research was done to know the cumulative average abnormal return before and after the announcement. The observation periods were 20 days, 10 days before, 10 days after the date of the announcement. This research used secondary data obtained from Mandiri Sekuritas website and Investing.com. The data used in this research included the closing price of stocks being sampled, including IHSG and PSE. The samples in this research were LQ45 stocks listed in Indonesia Stock Exchange (IDX) and PSEi stocks listed in Philippine Stock Exchange (PSE). The event study analysis using paired t test was done to know the significance of the hypothesis. The result in this research found that there was cumulative average abnormal return in Indonesia Stock Exchange and Philippine Stock Exchange before and after the announcement of International Sporting Event. It was proved by the observation with the probability (p-value) below the 5% error level.