We examine how pre-announcement weather conditions near a firm's major institutional investors affect stock market reactions to firms' earnings announcements. We find that unpleasant weather experienced by institutional investors leads to more delayed market responses to subsequent earnings news. Moreover, unpleasant weather of institutional investors is associated with higher earnings announcement premia. The influence of institutional investors' weather is robust after controlling for New York City weather, extreme weather conditions, and firm local weather. Additional cross-sectional evidence suggests that the strength of this weather effect is related to institutional investors' trading behavior.

The debate on the puzzling relationship between financial development and economic growth in China has remained inconclusive because the effects of banking ownership structure and size structure are highly intertwined in the existing studies. This paper addresses this problem by specifying an empirical model to disentangle the two structural effects. The analysis uses a data set that includes the banking sector and 28 manufacturing industries across 30 Chinese provinces over the period 1999–2007. In order to identify the channel through which banking structure affects industrial growth, two interactive variables are constructed to capture the interaction of the prevailing banking structure with labor intensity and the share of non-state-owned enterprises in each industry, respectively. The regression results are robust and make the case for the ongoing banking reforms to reduce state ownership and promote small banking institutions.