The impact of economic policy uncertainty on stock returns of Turkish tourism companies

Abstract

Economic policy uncertainty (EPU) has various implications for financial markets. This study examines the effects of EPU on stock prices of listed tourism companies in Turkey for the time period of 2002-2013. We show that EPU in Europe and Turkey has significant negative effects on tourism index returns. The finding reflects that stock returns of the Turkish tourism companies apparently depend on domestic and international economic uncertainty. Among the included macroeconomic variables, consumer confidence index is the only factor which has an impact on stock returns.