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2020 ; 54
(ä): 101249
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Stock markets reaction to COVID-19: Cases or fatalities?
#MMPMID34170989
Ashraf BN
Res Int Bus Finance
2020[Dec]; 54
(ä): 101249
PMID34170989
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In this paper, we examine the stock markets' response to the COVID-19 pandemic.
Using daily COVID-19 confirmed cases and deaths and stock market returns data
from 64 countries over the period January 22, 2020 to April 17, 2020, we find
that stock markets responded negatively to the growth in COVID-19 confirmed
cases. That is, stock market returns declined as the number of confirmed cases
increased. We further find that stock markets reacted more proactively to the
growth in number of confirmed cases as compared to the growth in number of
deaths. Our analysis also suggests negative market reaction was strong during
early days of confirmed cases and then between 40 and 60 days after the initial
confirmed cases. Overall, our results suggest that stock markets quickly respond
to COVID-19 pandemic and this response varies over time depending on the stage of
outbreak.