Journal of Business Ethics

, Volume 154, Issue 3, pp 683–699 | Cite as

Price Reaction of Ethically Screened Stocks: A Study of the Dow Jones Islamic Market World Index

  • Khelifa Mazouz
  • Abdulkadir Mohamed
  • Brahim SaadouniEmail author
Original Paper


This paper investigates the short-term effects on the price of the ethically screened stocks of the Dow Jones Islamic Market World Index (DJIMWI) quarterly revisions. Using a sample of 8250 stocks from May 1999 through June 2012, we find a significant price reaction of the ethically screened stocks following additions and deletions. The results show that additions (deletions) from emerging stock markets tend to experience a greater and significantly positive (negative) price response than additions (deletions) from the developed markets. Further tests reveal that the price reactions following DJIMWI revisions are likely to be driven by shifts in investor sentiment rather than changes in firm fundamentals.


Ethically screened stocks Additions and Deletions Dow Jones Islamic Market World Index Emerging and developed markets Investor sentiment 


Compliance with Ethical Standards

Conflict of interest

Khelifa Mazouz, Abdulkadir Mohamed, Brahim Saadouni declare that they have no conflict of interest.

Ethical approval

This article does not contain material from any studies with human participants or animals performed by any of the authors.


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Copyright information

© Springer Science+Business Media Dordrecht 2016

Authors and Affiliations

  • Khelifa Mazouz
    • 1
  • Abdulkadir Mohamed
    • 2
  • Brahim Saadouni
    • 3
    • 4
    Email author
  1. 1.Cardiff Business SchoolCardiff UniversityCardiffUK
  2. 2.Cranfield School of ManagementCranfield UniversityCranfieldUK
  3. 3.Alliance Manchester Business SchoolThe University of ManchesterManchesterUK
  4. 4.School of Banking and FinanceThe University of New South WalesSydneyAustralia

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