Branding the bull: brand attraction on stock volatility and returns in the developed and emerging markets

This study examines how brand attraction influences stock returns and stock volatility, and how investor sentiment moderates these relationships across developed and emerging markets. Using panel data from 5,281 publicly listed firms in the United States, China, and India from January 2018 to June 2025, fixed-effects and feasible generalized least squares (FGLS) estimations are employed to account for firm-level heterogeneity and time-series dependence. The empirical results show that higher brand attraction is consistently associated with higher stock returns, indicating that brand visibility functions as a value-relevant signal in financial markets. At the same time, brand attraction significantly increases stock volatility, reflecting intensified investor attention and trading activity. Investor sentiment plays a critical moderating role by amplifying both returns and volatility, with interaction effects substantially stronger in China and India than in the United States. This cross-market heterogeneity suggests that sentiment-driven amplification is more pronounced in environments characterised by greater information asymmetry and higher retail investor participation. This study makes a novel contribution by empirically demonstrating that brand attraction simultaneously affects market performance and risk, and by providing cross-country evidence that investor sentiment is a key channel through which brand-related information is amplified in emerging markets.