COVID-19 and Two different Stock Markets: An Event Study Analysis

Fakhrul Hasan, Ahmed Ashfaque Shahbaz

Research output: Contribution to journalArticlepeer-review

Abstract

In this study, we examine two different stock markets’ response to the COVID-19 pandemic using event study methodology and a novel linear regression model. We use LSE (UK) as a proxy for the developed countries stock market and DSE (Bangladesh) as a proxy for the developing countries stock market. Using the daily COVID-19 confirmed cases and deaths and stock market returns data from these two countries (UK and Bangladesh) over the period November 01, 2020 to August 07, 2020. Our main research question was, which stock market suffered more during the COVID-19 pandemic, whether developed countries stock market or developing countries stock market. We find that developed countries stock markets (LSE as proxy) responded negatively to the growth in COVID-19 confirmed cases and deaths in COVID-19. We further find that developing countries stock markets (DSE as proxy) did not responded to the growth in COVID-19 confirmed cases and deaths in COVID-19.
Original languageEnglish
Pages (from-to)3-18
Number of pages16
JournalThe Journal of Prediction Markets
Volume15
Issue number2
Early online date31 Aug 2021
DOIs
Publication statusPublished - 14 Dec 2021
Externally publishedYes

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