Abstract:

China Pakistan Economic Corridor (CPEC) is supposed to be a miracle especially for Pakistani economy. Its fruits have influenced Pakistan By more than $54 billion. Working on CPEC is same as working with all the stake holders in Pakistan economy. Its impact is supposed to be gigantic and effecting most of the sectors of Pakistani economy. Keeping an eye on all such considerations the aim of this research is to examine the difference in average stock return of various companies (underlying different sector which are steel, insurance, banks, cement & Automobile) to pre and post CPEC announcement date. Secondary data is collected from financial reports of the company covering a period between Jan 2012- oct 2016. Paired sample t test is statistical technique chosen for the analysis. The findings of the research are quite interesting and highlighting the fact that no statistically significant change is found in average stock returns of any sector (p>0.05) when a comparison is established between pre and post announcement period of CPEC. Although the findings are surprising but the reality that CPEC is in its initial stage cannot be denied, its impact would be soon visible as progression would be made.