Abstract
Prior research documents that media coverage attracts investor attention and improves the liquidity of the featured firms. However, increased attention to the covered firms may divert attention away from uncovered firms. In the setting of Wall Street Journal's coverage of firms’ earnings announcements, I find that industry peers of the announcing firm experience a decrease in stock liquidity around the article publication day. The decrease cannot be attributed to the earnings announcement per se, and is more pronounced when the peer is less visible and less related to the announcing firm. These findings shed novel light on the negative externalities of media coverage on peer liquidity.
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