Paper Title
Would the Lag in Stock Reactions in GCC Markets be a Sign of a Language Effect? An Application to CRAS‟ Announcements

Stock markets in the GCC countries are characterized by the domination of individual investors, therefore, we investigate how this characteristic may influence markets’ behavior. We examine the market reaction to the announcements conveyed by the major international credit rating agencies’ (CRAs). We assume the English language used by the CRAs to publish their news may fail to reduce the asymmetric information in GCC markets, due to the low level of English knowledge amongst the individuals. We apply a questionnaire & an event-study, and we find evidence for an influence of the English language on the individual investors’ reaction. Keywords - Credit rating agencies, Event-study, questionnaire, language effect, Individual domination. JLE classifications: G14, G24, G41, C83