Do Earthquakes Shake Stock Markets?
This paper examines how major earthquakes affected the returns and volatility of aggregate stock market indices in thirty-five financial markets over the last twenty years. Results show that global financial markets are resilient to shocks caused by earthquakes even if these are domestic. Our analys...
| Main Authors: | , |
|---|---|
| Format: | Article |
| Language: | English |
| Published: |
Public Library of Science (PLoS)
2015-01-01
|
| Series: | PLoS ONE |
| Online Access: | http://europepmc.org/articles/PMC4510879?pdf=render |
| _version_ | 1811265833317433344 |
|---|---|
| author | Susana Ferreira Berna Karali |
| author_facet | Susana Ferreira Berna Karali |
| author_sort | Susana Ferreira |
| collection | DOAJ |
| description | This paper examines how major earthquakes affected the returns and volatility of aggregate stock market indices in thirty-five financial markets over the last twenty years. Results show that global financial markets are resilient to shocks caused by earthquakes even if these are domestic. Our analysis reveals that, in a few instances, some macroeconomic variables and earthquake characteristics (gross domestic product per capita, trade openness, bilateral trade flows, earthquake magnitude, a tsunami indicator, distance to the epicenter, and number of fatalities) mediate the impact of earthquakes on stock market returns, resulting in a zero net effect. However, the influence of these variables is market-specific, indicating no systematic pattern across global capital markets. Results also demonstrate that stock market volatility is unaffected by earthquakes, except for Japan. |
| first_indexed | 2024-04-12T20:31:03Z |
| format | Article |
| id | doaj.art-e9ba449845d5491d8ece8e083f874889 |
| institution | Directory Open Access Journal |
| issn | 1932-6203 |
| language | English |
| last_indexed | 2024-04-12T20:31:03Z |
| publishDate | 2015-01-01 |
| publisher | Public Library of Science (PLoS) |
| record_format | Article |
| series | PLoS ONE |
| spelling | doaj.art-e9ba449845d5491d8ece8e083f8748892022-12-22T03:17:44ZengPublic Library of Science (PLoS)PLoS ONE1932-62032015-01-01107e013331910.1371/journal.pone.0133319Do Earthquakes Shake Stock Markets?Susana FerreiraBerna KaraliThis paper examines how major earthquakes affected the returns and volatility of aggregate stock market indices in thirty-five financial markets over the last twenty years. Results show that global financial markets are resilient to shocks caused by earthquakes even if these are domestic. Our analysis reveals that, in a few instances, some macroeconomic variables and earthquake characteristics (gross domestic product per capita, trade openness, bilateral trade flows, earthquake magnitude, a tsunami indicator, distance to the epicenter, and number of fatalities) mediate the impact of earthquakes on stock market returns, resulting in a zero net effect. However, the influence of these variables is market-specific, indicating no systematic pattern across global capital markets. Results also demonstrate that stock market volatility is unaffected by earthquakes, except for Japan.http://europepmc.org/articles/PMC4510879?pdf=render |
| spellingShingle | Susana Ferreira Berna Karali Do Earthquakes Shake Stock Markets? PLoS ONE |
| title | Do Earthquakes Shake Stock Markets? |
| title_full | Do Earthquakes Shake Stock Markets? |
| title_fullStr | Do Earthquakes Shake Stock Markets? |
| title_full_unstemmed | Do Earthquakes Shake Stock Markets? |
| title_short | Do Earthquakes Shake Stock Markets? |
| title_sort | do earthquakes shake stock markets |
| url | http://europepmc.org/articles/PMC4510879?pdf=render |
| work_keys_str_mv | AT susanaferreira doearthquakesshakestockmarkets AT bernakarali doearthquakesshakestockmarkets |