The Impact of the Corona Crisis on the Worldwide Stock Markets: An Empirical Analysis with Cross National Event Study Approach
The Corona Crisis led to a high drawdown in the stock markets in the whole world in March 2020. After that, infection rates, incidences, and dead people were published by many countries. Based on 11 stock price indices analyses according to volatility and correlation, we can conclude that only one...
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| Format: | Article |
| Language: | English |
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EconJournals
2022-11-01
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| Series: | International Journal of Economics and Financial Issues |
| Subjects: | |
| Online Access: | https://econjournals.com/index.php/ijefi/article/view/13705 |
| _version_ | 1797918988784631808 |
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| author | Annika Fischer Noel Opala Svend Reuse Martin Svoboda |
| author_facet | Annika Fischer Noel Opala Svend Reuse Martin Svoboda |
| author_sort | Annika Fischer |
| collection | DOAJ |
| description |
The Corona Crisis led to a high drawdown in the stock markets in the whole world in March 2020. After that, infection rates, incidences, and dead people were published by many countries. Based on 11 stock price indices analyses according to volatility and correlation, we can conclude that only one event seems to be substantially affected by a Corona-related event not tied to specific countries. Therefore, in times of crisis, stock indices correlate highly positively. This leads us to a second step to our central research question: Do Corona dates significantly impact the stock price development? Therefore, we analyzed several events in Germany and the US with the event study approach. The main result is that only the March 2020 event significantly impacts the volatility and the returns. The following bad news but also the good news do not have any influence on the share prices and do not lead to abnormal returns. For example, the first approval of vaccinations had no apparent effect on the stock market, which was reflected in price movements comparable to those during the initial Lockdown.
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| first_indexed | 2024-04-10T13:38:15Z |
| format | Article |
| id | doaj.art-c87fbdd64dc142b5922f6d47a02d4d4b |
| institution | Directory Open Access Journal |
| issn | 2146-4138 |
| language | English |
| last_indexed | 2024-04-10T13:38:15Z |
| publishDate | 2022-11-01 |
| publisher | EconJournals |
| record_format | Article |
| series | International Journal of Economics and Financial Issues |
| spelling | doaj.art-c87fbdd64dc142b5922f6d47a02d4d4b2023-02-15T16:11:18ZengEconJournalsInternational Journal of Economics and Financial Issues2146-41382022-11-0112610.32479/ijefi.13705The Impact of the Corona Crisis on the Worldwide Stock Markets: An Empirical Analysis with Cross National Event Study ApproachAnnika Fischer0Noel Opala1Svend Reuse2Martin Svoboda3Department of Finance, Faculty of Economics and Administration, Masaryk University, Lipová 41a, 60200 Brno, Czech RepublicDepartment of Finance, Faculty of Economics and Administration, Masaryk University, Lipová 41a, 60200 Brno, Czech Republic, FOM University of Applied Sciences, ISF – Institute for Strategic Finance, GermanyDepartment of Financial Law and Economics, Faculty of Law, Masaryk University Veveří 70, 611 80 Brno, Czech Republic. The Corona Crisis led to a high drawdown in the stock markets in the whole world in March 2020. After that, infection rates, incidences, and dead people were published by many countries. Based on 11 stock price indices analyses according to volatility and correlation, we can conclude that only one event seems to be substantially affected by a Corona-related event not tied to specific countries. Therefore, in times of crisis, stock indices correlate highly positively. This leads us to a second step to our central research question: Do Corona dates significantly impact the stock price development? Therefore, we analyzed several events in Germany and the US with the event study approach. The main result is that only the March 2020 event significantly impacts the volatility and the returns. The following bad news but also the good news do not have any influence on the share prices and do not lead to abnormal returns. For example, the first approval of vaccinations had no apparent effect on the stock market, which was reflected in price movements comparable to those during the initial Lockdown. https://econjournals.com/index.php/ijefi/article/view/13705Covid-19, event study, abnormal returns, volatility, correlation |
| spellingShingle | Annika Fischer Noel Opala Svend Reuse Martin Svoboda The Impact of the Corona Crisis on the Worldwide Stock Markets: An Empirical Analysis with Cross National Event Study Approach International Journal of Economics and Financial Issues Covid-19, event study, abnormal returns, volatility, correlation |
| title | The Impact of the Corona Crisis on the Worldwide Stock Markets: An Empirical Analysis with Cross National Event Study Approach |
| title_full | The Impact of the Corona Crisis on the Worldwide Stock Markets: An Empirical Analysis with Cross National Event Study Approach |
| title_fullStr | The Impact of the Corona Crisis on the Worldwide Stock Markets: An Empirical Analysis with Cross National Event Study Approach |
| title_full_unstemmed | The Impact of the Corona Crisis on the Worldwide Stock Markets: An Empirical Analysis with Cross National Event Study Approach |
| title_short | The Impact of the Corona Crisis on the Worldwide Stock Markets: An Empirical Analysis with Cross National Event Study Approach |
| title_sort | impact of the corona crisis on the worldwide stock markets an empirical analysis with cross national event study approach |
| topic | Covid-19, event study, abnormal returns, volatility, correlation |
| url | https://econjournals.com/index.php/ijefi/article/view/13705 |
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