THE EFFECT OF FINANCIAL MARKET UNCERTAINTY AND VALUE RELEVANCE OF ACCOUNTING INFORMATION
Keywords:
Financial Market Uncertainty, Value Relevance, Stock Price, SET Index, Bond Index, Exchange rateAbstract
This research aimed to investigate the effects of financial market uncertainty on investors’ value relevance of accounting information in Thailand. Using the valuation model of Ohlson (1995), this study was an empirical study using multiple regression analysis. The study collected data from 2011 to 2019 and obtained information from SET100 listed companies on the Stock Exchange of Thailand. The study revealed that financial market uncertainty increases the use of accounting information for making investments. The deviation of the SET index is an influential factor that spurs the use of accounting information in making investment decisions when the financial market experiences uncertainty. While the deviation of other factors in the financial market, such as the government bond index, the interest rate of the government bond, and the US dollars to baht exchange rate, does not have a significant effect on the value relevance of accounting information in making investment decisions. Moreover, it was found that the explanatory power of accounting information has little effect on the factor of financial market uncertainty. However, in the years that the SET index or interest is highly volatile, the explanatory power of value relevance of accounting information is increased more than the other years. This can be supported by the investor always paying attention when using accounting information in their decision-making towards investment in the stock market, no matter the form of financial market uncertainty.
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