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EU Regulation and open market share repurchases: new evidence

Drousia, Angeliki and Episcopos, Athanasios and Leledakis, George N and Pyrgiotakis, Emmanouil G (2021) 'EU Regulation and open market share repurchases: new evidence.' The European Journal of Finance. pp. 1-21. ISSN 1351-847X

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This paper re-examines the impact of the EU Market Abuse Directive (MAD) on the market reaction around share repurchase announcements. We use a unique hand-collected dataset of firms listed on the Athens Stock Exchange, and we find evidence that contrasts with previous conclusions for large European economies. The implementation of the MAD is followed by a significant increase in announcement abnormal returns, which is more pronounced in initial repurchase programs. Our results remain robust to a series of robustness tests. We attribute our findings to cross-country differences in institutional framework and pre-MAD existing national laws. Collectively, our results support the notion that EU directives do not have a uniform effect across Member States. Thus, the impact of such reforms should also be examined in individual capital market studies.

Item Type: Article
Uncontrolled Keywords: Share repurchases; Market Abuse Directive; safe harbor; signaling undervaluation
Divisions: Faculty of Social Sciences
Faculty of Social Sciences > Essex Business School
Faculty of Social Sciences > Essex Business School > Essex Finance Centre
SWORD Depositor: Elements
Depositing User: Elements
Date Deposited: 06 Apr 2021 11:45
Last Modified: 06 Jan 2022 14:23

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