The Impact Of Information Disclosure Quality And Analysts’ Behavior On Stock Price Synchronicity

In recent years, the quality of information disclosure in China’s SME board market is rather worrying, such as forging performance, concealing client relationship and so on. At the same time, along with the deepening of.reform process of China’s capital market, the analysts have been paid more and more attention. As the interpreter of the information flow, their main function is to forecast the volatility of stock market in the future, so as to reduce the stock price synchronicity and then improve the efficiency of stock market. However, the securities consulting industry has been questioned about its credibility and objectivity nowadays. The phenomena that star analysts intentionally disclosed insider information and then was suspended for investigation is common. Therefore, the analysts’ influence on the efficience of stock market remains to be further investigated in China’s emerging and transitional market.Since the quality of accounting information disclosure and analyst behavior have common influence on the stock price synchronicity, this paper first makes relative literature review; secondly puts forward the relevant research hypotheses according to the information asymmetry theory, principal-agent theory, effective market theory and behavioral finance theory; finally makes empirical tests of the influence of the quality of information disclosure and analysts behavior on the stock price synchronicity with the sample of nonfinancial listed corporation of China’s SME board in 2011-2014. Moreover, the robustness of the tests above has been examined.The conclusions are as follows:(1) The quality of information disclosure and stock price synchronicity in China’s SME board are in significantly positive relationship. (2) The relationship of the stock price synchronicity and the number of analyst following is significantly negative, while the stock price synchronicity and the level of analysts’ earnings forecast, namely the accuracy and dispersion, is significantly positively. (3) With the increase of the number of analyst following, the positive impact of the quality of information disclosure on stock price synchronicity is weaker. Meanwhile, with the growth of the level of analyst’s earnings forecast, the quality of information disclosure can enhance the stock price synchronicity of the SME board market. (4) With the improvement of the quality of information disclosure, the negative relationship between the number of analysts following and the stock price synchronicity is strengthened. Also, the positive correlation between the level of analysts’earnings forecast and the stock price synchronicity is strengthened.It follows that China’s SME board market is surrounded by noise trading. Thus the stock price synchronicity positively reflected the information efficiency. To ensure the stable development of SME board market, measures should be taken such as improving the enterprise accounting standards, the information disclosure institution, incentive mechanism and restraint mechanism of listed corporation. With mandatory and voluntary information disclosure policy, the quality of accounting information source could be controlled effectively. The information asymmetry and agency problems could also be alleviated. At the same time, the regulator should further standardize the development of the securities consulting industry to ensure that analysts play the real role in the name of the law which defend its objective, impartial and independent market position. Finally, we need to strengthen the education of investors in China, help them abandon the habit of speculation and turn back to rational investment.