TY - JOUR
T1 - The COVID-19 outbreak and stock market reactions
T2 - Evidence from Australia
AU - Rahman, Md Lutfur
AU - Amin, Abu
AU - Al Mamun, Mohammed Abdullah
N1 - Publisher Copyright:
© 2020
PY - 2021/1
Y1 - 2021/1
N2 - We examine how the Australian stock market responded to the uncertainties created by the COVID-19 pandemic and whether the stimulus package offered by the Government helped restore confidence in the market. This study finds a negative stock market reaction to the pandemic announcement, however, among two stimulus packages related announcements, the market reacted positively only to “JobKeeper” package. The cross-sectional results suggest that the smallest, least profitable and value portfolios suffered more during the pandemic. Finally, size and liquidity are found to be the significant drivers of abnormal returns. These results generally hold for a battery of robustness checks.
AB - We examine how the Australian stock market responded to the uncertainties created by the COVID-19 pandemic and whether the stimulus package offered by the Government helped restore confidence in the market. This study finds a negative stock market reaction to the pandemic announcement, however, among two stimulus packages related announcements, the market reacted positively only to “JobKeeper” package. The cross-sectional results suggest that the smallest, least profitable and value portfolios suffered more during the pandemic. Finally, size and liquidity are found to be the significant drivers of abnormal returns. These results generally hold for a battery of robustness checks.
KW - Australian stock market
KW - COVID-19
KW - Coronavirus
KW - Government stimulus package
KW - JobKeeper package
UR - http://www.scopus.com/inward/record.url?scp=85095815365&partnerID=8YFLogxK
U2 - 10.1016/j.frl.2020.101832
DO - 10.1016/j.frl.2020.101832
M3 - Article
AN - SCOPUS:85095815365
SN - 1544-6123
VL - 38
JO - Finance Research Letters
JF - Finance Research Letters
M1 - 101832
ER -