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Death and contagious infectious diseases: Impact of the COVID-19 virus on stock market returns

Author

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  • Al-Awadhi, Abdullah M.
  • Alsaifi, Khaled
  • Al-Awadhi, Ahmad
  • Alhammadi, Salah

Abstract

This study investigates whether contagious infectious diseases affect stock market outcomes. As a natural experiment, we use panel data analysis to test the effect of the COVID-19 virus, which is a contagious infectious disease, on the Chinese stock market. The findings indicate that both the daily growth in total confirmed cases and in total cases of death caused by COVID-19 have significant negative effects on stock returns across all companies.

Suggested Citation

  • Al-Awadhi, Abdullah M. & Alsaifi, Khaled & Al-Awadhi, Ahmad & Alhammadi, Salah, 2020. "Death and contagious infectious diseases: Impact of the COVID-19 virus on stock market returns," Journal of Behavioral and Experimental Finance, Elsevier, vol. 27(C).
    • Handle: RePEc:eee:beexfi:v:27:y:2020:i:c:s2214635020300800
    DOI: 10.1016/j.jbef.2020.100326
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    References listed on IDEAS

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    More about this item

    Keywords

    Stock returns; COVID-19;

    JEL classification:

    • G10 - Financial Economics - - General Financial Markets - - - General (includes Measurement and Data)
    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading
    • G15 - Financial Economics - - General Financial Markets - - - International Financial Markets
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models

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