Fumiko Takeda

Google Search Intensity and Its Relationship with Returns and Trading Volume of Japanese Stocks

This study examines the relationship between online search intensity and stock-trading behavior in the Japanese market. The search intensity is measured by the search volume of company names on Google. Our sample consists of 189 Japanese stocks searched between 2008 and 2011. We find correlations with search intensity that are strongly positive for trading volume and weakly positive for stock returns. Our results are consistent with the notion that the increase in search activity is associated with increases in trading activity, but the probability that this increase in trading raises stock prices is not high.

The effect of the Fukushima nuclear accident on stock prices of electric power utilities in Japan

The purpose of this study is to investigate the effect of the accident at the Fukushima Daiichi nuclear power station, which is owned by Tokyo Electric Power Co. (TEPCO), on the stock prices of the other electric power utilities in Japan. Because the other utilities were not directly damaged by the Fukushima nuclear accident, their stock price responses should reflect the change in investor perceptions on risk and return associated with nuclear power generation. Our first finding is that the stock prices of utilities that own nuclear power plants declined more sharply after the accident than did the stock prices of other electric power utilities. In contrast, investors did not seem to care about the risk that may arise from the use of the same type of nuclear power reactors as those at the Fukushima Daiichi station. We also observe an increase of both systematic and total risks in the post-Fukushima period, indicating that negative market reactions are not merely caused by one-time losses but by structural changes in society and regulation that could increase the costs of operating a nuclear power plant.

Information Content of Internal Control Weaknesses: The Evidence from Japan

This paper investigates how capital markets in a code-law country, Japan, react to the disclosure of internal control weaknesses (ICW). The Japanese government attempted to implement a more concise, efficient, and, thus, less strict internal control reporting system than Section 404 of the US-SOX. In fact, for the first two years, the disclosure rate of ICW has been much lower in Japan than in the U.S. While market reactions to the disclosure of ICW are not significantly different from zero in our event study analysis, they become significantly negative after controlling for other information released around the disclosure date, audit quality, and other firm attributes. Our results are consistent with the notion that the disclosure of ICW is informative to the market because it is less frequent and exceptional in Japan.

Characteristics and stock prices of firms flamed on the Internet

This study investigates Internet flaming using Japanese data on flamed firms.We find that large firms with negative net income are more likely to be flamed.Flaming alone may be too weak to impact the stock prices in the short-run.Flaming can lower the stock prices at a later period, or with newspapers reports.Negative market reactions are intensified with the serious flaming contents. In this study, we investigate the economic impact of flaming on the Internet using Japanese data. In examining the data on firms that experienced flaming between 2006 and September 2013, we establish the following three main findings. First, large firms and ones with negative net income are more likely to be flamed on the Internet. Second, flaming alone may be too weak to impact the stock prices of target firms in the short-term, although it can lower the stock price of target firms at a later period, or when newspapers report the same event. Third, the negative market reaction grows when the flaming content is serious.

Price movements in the Japanese online home electronics market

This article investigates the price movements of home electronics products listed on a Japanese price comparison site. Our findings are as follows. (1) Price dispersion increases at earlier stages of the product life cycle and decreases at later stages. (2) The size of the price changes is larger in earlier stages than in the later stages. (3) The lowest prices change very frequently. (4) The lowest price decreases outnumber the lowest price increases. (5) The size of the lowest price changes is very small and is smaller when decreases occur than when increases occur.

Google Search Intensity and its Relationship to the Returns and Liquidity of Japanese Startup Stocks

This study investigates the relationship between investor attention and stock price movements in Japan’s startup stock exchanges, Mothers and JASDAQ. We find a positive relationship between search intensity and stock returns and between search intensity and liquidity. The positive correlation between search intensity and stock returns/liquidity tends to be larger for start-up firms with a high proportion of individual shareholders. Contrary to prior studies that have reported a reversal after an immediate stock price increase, our results show the possibility that an immediate increase in stock returns of startup firms may not be neutralized in the long run.

The Impact of Online Flaming on Firm Value: The Evidence from Japan

This study investigates Internet flaming using Japanese data on flamed firms listed on the first section of the Tokyo Stock Exchange from 2006 through 2013. Based on a probit model, we find that younger and/or larger firms with higher price book-value ratio (PBR) are more likely to be the target of online flaming. In addition, the event study shows that the stock prices of targeted firms tend to decline during the initial days of online flaming. However, we also show that only big corporate scandals reported by the mass media have significantly negative effects on the stock prices of flamed firms, while the short-term impact of other contents is not significant.

R&D Stages and Stock Price Reactions in the Japanese Market

This paper investigates how stock markets react to the release of R&D-related news by studying stock price data for firms listed on the first section of the Tokyo Stock Exchange between 2000 and 2006. If information uncertainty is the major cause of the post-announcement drift, post-announcement drift should decrease with R&D progress. Our results show that late-stage R&D announcements increase stock prices. The post-announcement drift tends to decrease with R&D progress for late-stage R&D news. For pharmaceutical industry, the negative association between drift and R&D progress is obtained for most R&D stages.