The Effect of Positivity of Tone on Stock Return: Evidence from Jordanian Commercial Banks

This study investigates the effect of the positivity of tone in financial disclosures on the stock returns of Jordanian commercial banks. The research aims to determine whether a positive tone in annual reports is associated with improved stock performance, considering the COVID-19 period. The study employs pooled regression analysis to examine the relationship between tone and stock returns for a sample of all Jordanian banks listed on the Amman Stock Exchange (ASE) from 2015 to 2022. The results reveal a significant negative relationship between the tone of disclosures and stock returns. The optimistic tone is perceived as manipulative, leading to lower stock returns. The findings highlight the importance of being cautious about a positive tone in managerial communications, as it significantly influences investor perception and stock performance.