The effects of daily growth in COVID-19 deaths, cases, and governments' response policies on stock markets of emerging economies

The spatial linkage mechanism: medical level, public health security, and economic climate from 19 OECD EU countries

Introduction

The global spread of the COVID-19 has brought about global changes, especially in terms of economic growth. Therefore, it has become a global issue to explore the impact of public health security on the economy.

Methods

Employing a dynamic spatial Durbin model, this study analyzes the spatial linkage mechanism of medical level, public health security, and economic climate in 19 countries as well as investigates the relationship between economic climate and COVID-19 by the panel data of 19 OECD European Union countries from March 2020 to September 2022.

Results

Results show that an improvement in the medical level can reduce the negative impact of public health security on the economy. Specifically, there is a significant spatial spillover effect. The degree of economic prosperity hurts the reproduction rate of COVID-19.

Discussion

Policymakers should consider both the severity of the public health security issues and the economic level when developing prevention and control policies. Given this, corresponding suggestions provide theoretical support for formulating policies to reduce the economic impact of public health security issues.

Corporate vulnerability in the US and China during COVID-19: A machine learning approach

The impact of COVID-19 on stock market dynamics and other macroeconomic indicators has been extensively researched. However, the question of how it affects corporate vulnerability has received less attention. This article aims to fill this gap by examining the implications of COVID-19 on corporate vulnerability in the United States (US) and China, using daily data from January 2020 to December 2021. The empirical results of cointegration analysis demonstrate that COVID-19 considerably worsen corporate vulnerabilities in the long-term in the US and in the short-term in China. Additionally, non-linear results demonstrate long-run asymmetries in the US and short-run asymmetries in China, confirming the accuracy of error prediction and suggesting that US corporations are more exposed to COVID-19-induced risks. The channels through which COVID-19 may affect corporate vulnerability include changes in consumer behavior and demand, disruptions in supply chains, financial stress, government policies and regulations, and changes in the competitive landscape. This study sheds light on the effects of the COVID-19 pandemic on corporate vulnerability in the US and China, revealing regulatory implications that may necessitate greater government involvement, managerial implications that emphasize risk management and contingency planning, and social implications that highlight the importance of prioritizing stakeholder welfare and embracing digital transformation.

Comparative evidence on the impact of the COVID-19 outbreak and vaccine discovery on the global transportation industry

This research investigated the daily abnormal stock returns of 727 listed companies from 63 countries. We tested the impact of two major COVID-19 related events-(1) the declaration by the World Health Organisation of the global pandemic and (2) the vaccine discovery announcement by Pfizer/BioNTech-on transportation stock price reactions. We found that the pandemic declaration event negatively affected transportation stocks, whereas the vaccine announcement had a positive effect. Passenger markets were more affected than freight markets. Airlines stocks were most struck during the pandemic, whereas railroad companies were unaffected. However, airlines were the best performers following the vaccine discovery event. During the pandemic incident, European transportation firms were hit to a large extent; however, they also rebounded well during the vaccine event. Transportation firms in emerging markets were hit more than those in developed markets; however, both recovered to the same degree during the vaccine event. Transportation firms from countries with higher exposure to China were affected less than those with lower exposure during both events. Our implications are relevant to how investors make investment decisions surrounding market uncertainty. Moreover, corporate managers can refer to the findings when they formulate their firm's financial policies and operations to respond to stock market reactions in the wake of the pandemic. Our results can also help policymakers evaluate and deploy effective policies to boost investor confidence and keep transportation firms viable during a crisis. Overall, the findings can be used for future policy formulation in the transportation industry.

The impacts of the Covid-19 pandemic, policy responses and macroeconomic fundamentals on market risks across sectors in Vietnam

Vietnam has undergone four waves of the Covid-19 pandemic in 2020 and 2021, which have posed significant market risks to various sectors. Understanding the market risk of Vietnamese sectors and its changes is important for policy implementation to support the economy after the pandemic. This study measures the sectoral market risks and examines the effects of the pandemic, policy responses and macroeconomic fundamentals on the market risks across sectors in Vietnam. We employ the Value-at-Risk (VaR) and Conditional Value-at-Risk (CVaR) techniques to measure the market risks for 24 sectors from 2012 to 2021. The market risk levels across Vietnamese sectors have changed significantly in response to the pandemic. Oil and Gas and Services sectors show the largest potential loss during the two Covid-19 waves in 2020. The Securities sector is the riskiest sector during the last two Covid-19 waves in 2021. Our results indicate that the new Covid-19 cases reported by the Government increase the market risk levels across Vietnamese sectors. On the other hand, enhancing containment and health policy and reducing economic policy uncertainty result in lower market risk across sectors. We also find that macroeconomic fundamentals such as the exchange rate and interest rate significantly affect the market risks across sectors in Vietnam.