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Journal of Economic Integration 2021 September;36(3) :462-490.
DOI: https://doi.org/10.11130/jei.2021.36.3.462
Stock Market Reactions to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership’s Approval: Evidence from Vietnam

Son Tung Ha1 Thi Hong Hanh Pham2 Thi Nguyet Anh Nguyen 1

1National Economics University, Vietnam
2University of Nantes, France
Corresponding Author: Son Tung Ha ,Tel: +84(0) 905666680, Email: hasontungneu@yahoo.com
Copyright ©2021 Journal of Economic Integration
ABSTRACT
We examine the stock market performance of Vietnam’s listed firms in response to the country’s approval of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). Employing an event study methodology, we first calculate the abnormal returns of all listed Vietnamese firms around the CPTPP’s approval date. Then, we attempt to link these abnormal returns to firms’ characteristics. We find evidence that the announcement of the CPTPP’s approval is associated with positive abnormal returns for Vietnam’s listed firms. We also find considerable heterogeneity in the magnitude and pace of the impacts of the CPTPP’s approval on market returns across Vietnam’s two stock exchanges. However, we fail to reject the null hypothesis that the market did not react to the CPTPP’s approval at the sectoral level.

JEL Classification
G14: Information and Market Efficiency; Event Studies
F13: Trade Policy; International Trade Organizations
F14: Empirical Studies of Trade
Keywords: Financial event study | Abnormal returns | Comprehensive and Progressive Agreement for Trans-Pacific Partnership | Vietnamese stock exchanges
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