Title: Impact of COVID-19 pandemic on stock markets: a case study of selected countries

Authors: Sonal Thukral; Amit Kumar Singh; Renu Ghosh; Murli Manohar Pant

Addresses: Delhi School of Management, Delhi Technological University, New Delhi – 110042, India ' Department of Commerce, Delhi School of Economics, University of Delhi, New Delhi – 110007, India ' Department of Management Studies Netaji Subhas University of Technology New Delhi – 110078, India ' PricewaterhouseCoopers Services LLP, Gurugram – 122002, India

Abstract: As the outbreak of COVID-19 resulted in a wave of trade restrictions, it is worthwhile to study its impact on India and its trading partners. Accordingly, the study aims to examine the effect of the announcement of COVID-19 pandemic on the stock market returns of selected economies that are India's largest trading partners. By employing event study methodology the study finds that the stock markets displayed an immediate negative response to the announcement. Soon after, when the markets began to recover it was observed that within a month, the majority of the markets adjusted to the announcement and began to converge with normal returns. The results also revealed that different markets recovered at varying speeds contingent on the number of COVID cases. The study contributes to the existing literature on the response of stock markets to the outbreak of pandemic and disastrous events, besides the literature on market efficiency.

Keywords: pandemic; COVID-19; coronavirus; event study; stock market; economic impact; European markets; Asian markets; black swan event; recovery.

DOI: 10.1504/IJMEF.2022.128498

International Journal of Monetary Economics and Finance, 2022 Vol.15 No.5, pp.451 - 466

Received: 10 Mar 2021
Accepted: 18 Jul 2021
Published online: 24 Jan 2023 *

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