Oil price uncertainty and stock price informativeness: Evidence from investment-price sensitivity in China

We study the effects of oil price uncertainty (OPU) on stock informativeness based investment-price sensitivity. Using Chinese stocks from 2008 to 2021, we find a negative relationship between OPU and strength Tobin's q (a standardized measure prices) for predicting investment opportunities. This finding is likely due crowding out informed investors rather than financial constraints brought by higher cost capital. Investment-price sensitivity also decreases more among firms in less-competition, high sales volatility, lower analysts' attention. What more, reduction concentrated public utilities, agriculture & livestock, industry instead real estate or commerce industries. These findings indicate that acquisition information related firms, consequently, future decisions.