COVID-19 PANDEMIC AND WORLD CAPITAL MARKETS: A REVIEW

Authors

  • Madiha Jabeen
  • Faiza Faiz Malik
  • Aisha Jabeen

Keywords:

Covid-19, stock market, bond index, Asian economies, Global Financial Markets

Abstract

Since 2019 the world is exposed to one of the deadliest pandemics of all times. As Covid-19 hit the nations in every possible way, the global financial markets got exposed to this shock as well. This paper reviews the effects of Covid-19 on financial markets of China and other Asian countries along with its impact on financial markets from rest of the world. World health Organization declared Covid-19 as a pandemic on 11th March 2020 because of its severity and worldwide spread. The stock markets of China and other Asian countries observed a significant downfall. The investor responses were reflected in the fluctuations of stock prices. In China, the notable industries that got badly affected by the pandemic were transportation, catering, mining, agriculture and accommodation. However, the better performance of some sectors helped the stock markets like education, information technology and health in particular. The financial markets of emerging economies and developing countries also suffered badly due to Covid-19. Besides China, other prominent nations that were hard hit by the pandemic include America, United Kingdom, Italy and Spain. One of the possible reasons for negative returns in European markets was the high media coverage related to Covid-19 that led to adverse investor sentiments and decline in market. Secondly, when the pandemic started the European countries announced lockdown at a very initial stage due to which all the economic activities shut down hence resulting into a decline in the market. However, some countries remained quite successful in controlling the virus namely Taiwan, New Zealand, South Korea and Hong Kong.

Downloads

Download data is not yet available.

References

Açikgöz, Ö., & Günay, A. (2020). The early impact of the Covid-19 pandemic on the global and Turkish economy. Turkish journal of medical sciences, 50(SI-1), 520-526.

Ali, M., Alam, N., & Rizvi, S. A. R. (2020). Coronavirus (COVID-19)—An epidemic or pandemic for financial markets. Journal of Behavioral and Experimental Finance, 27, 100341.

Al-Najjar, H., & Al-Rousan, N. (2020). Are Italy and Iran really suffering from COVID-19 epidemic? A controversial study.

Ashraf, B. N. (2020). Stock markets’ reaction to COVID-19: Cases or fatalities?. Research in International Business and Finance, 54, 101249.

Assessment, O. I. E. (2020). Coronavirus: The world economy at risk. Organisation for Economic Co-operation and Development, France.

Baniamin, H. M., Rahman, M., & Hasan, M. T. (2020). The COVID-19 pandemic: why are some

countries coping more successfully than others?. Asia Pacific Journal of Public Administration, 42(3), 153- 169.

Ebrahim, S. H., & Memish, Z. A. (2020). COVID-19: preparing for superspreader potential among Umrah pilgrims to Saudi Arabia. Lancet (London, England), 395(10227), e48

Giuffrida, A. (2020). Bergamo mayor says football match escalated infections in Italian province. The Guardian.

Haroon, O., & Rizvi, S. A. R. (2020). COVID-19: Media coverage and financial markets behavior—A sectoral inquiry. Journal of Behavioral and Experimental Finance, 27, 100343.

He, Q., Liu, J., Wang, S., & Yu, J. (2020). The impact of COVID-19 on stock markets. Economic and Political Studies, 8(3), 275-288.

He, P., Sun, Y., Zhang, Y., & Li, T. (2020). COVID–19’s impact on stock prices across different

sectors—An event study based on the Chinese stock market. Emerging Markets Finance and Trade, 56(10), 2198-2212.

Horowitz, J., Bubola, E., & Povoledo, E. (2020). Italy, pandemic’s new epicenter, has lessons for the world. New York Times, 21.

Jabeen, S., & Farhan, M. (2020). COVID-19: The Pandemic's Impact on Economy and Stock Markets. Journal of Managerial Sciences, 14.

Liu, H., Wang, Y., He, D., & Wang, C. (2020). Short term response of Chinese stock markets to the outbreak of COVID-19. Applied Economics, 52(53), 5859-5872.

McGuire, D., Cunningham, J. E., Reynolds, K., & Matthews-Smith, G. (2020). Beating the virus:

an examination of the crisis communication approach taken by New Zealand Prime Minister Jacinda Ardern during the Covid-19 pandemic. Human resource development international, 23(4), 361-379.

Savage, M. (2020). Lockdown, what lockdown. Sweden's unusual response to coronavirus.

Shen, H., Fu, M., Pan, H., Yu, Z., & Chen, Y. (2020). The impact of the COVID-19 pandemic on

firm performance. Emerging Markets Finance and Trade, 56(10), 2213-2230.

Srivastava, S., & Agarwal, N. (2020). Psychological & Social Effects of Pandemic Covid-19 On

Education System, Business Growth, Economic Crisis & Health Issues Globally. Globus An International Journal of Management & IT A Refereed Research Journal, 11(2), 40-45.

Summers, J., Cheng, H. Y., Lin, H. H., Barnard, L. T., Kvalsvig, A., Wilson, N., & Baker, M. G.

(2020). Potential lessons from the Taiwan and New Zealand health responses to the COVID-19 pandemic. The Lancet Regional Health-Western Pacific, 100044.

Topcu, M., & Gulal, O. S. (2020). The impact of COVID-19 on emerging stock markets. Finance Research Letters, 36, 101691.

Wójcik, D., & Ioannou, S. (2020). COVID‐19 and Finance: Market Developments So Far and

Potential Impacts on the Financial Sector and Centres. Tijdschrift voor economische en sociale geografie, 111(3), 387-400.

Wong, T. (2020). Coronavirus: Why some countries wear face masks and others don’t. BBC News, 12, 2020.

Zhang, D., Hu, M., & Ji, Q. (2020). Financial markets under the global pandemic of COVID-

Finance Research Letters, 36, 101528.

Downloads

Published

2021-12-30

How to Cite

Jabeen, M. ., Malik, F. F. ., & Jabeen, A. . (2021). COVID-19 PANDEMIC AND WORLD CAPITAL MARKETS: A REVIEW. The Journal of Contemporary Issues in Business and Government, 27(6), 1324–1330. Retrieved from https://cibgp.com/au/index.php/1323-6903/article/view/2241

Issue

Vol. 27 No. 6 (2021): The journal of contemporary issues in business and government

Section

Articles

License

Creative Commons License

This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.

You are free to:

  1. Share — copy and redistribute the material in any medium or format for any purpose, even commercially.
  2. Adapt — remix, transform, and build upon the material for any purpose, even commercially.
  3. The licensor cannot revoke these freedoms as long as you follow the license terms.

Under the following terms:

  1. Attribution — You must give appropriate credit , provide a link to the license, and indicate if changes were made . You may do so in any reasonable manner, but not in any way that suggests the licensor endorses you or your use.
  2. No additional restrictions — You may not apply legal terms or technological measures that legally restrict others from doing anything the license permits.

Notices:

You do not have to comply with the license for elements of the material in the public domain or where your use is permitted by an applicable exception or limitation .

No warranties are given. The license may not give you all of the permissions necessary for your intended use. For example, other rights such as publicity, privacy, or moral rights may limit how you use the material.