Beschreibung:
Using the staggered hosting of Olympic Games as a shock to market participants’ attention to U.S.-listed foreign firms, we find that financial analysts tend to provide more accurate earnings forecasts for U.S.-listed foreign firms from the Olympics-hosting countries after their home countries host the Olympics. Especially, analysts who cover U.S-listed foreign firms from both the hosting and non-hosting countries provide less accurate forecasts for those firms of lower relative importance from the non-hosting countries in their portfolios. Our cross-sectional tests show that the effect of hosting the Olympics is more pronounced for firms with more transparent information environments and for those from the Olympics-hosting countries that are non-English speaking, culturally distant from U.S, and have non-common law origins. Collectively, our findings provide novel evidence that prominent global sporting events can have a significant effect on the attention reallocation of foreign market participants, financial analysts in particular