Investigating the financial impact of coronavirus on leading stock indices


  • Mitashi Sinha Researcher, Shaheed Sukhdev College of Business Studies, New Delhi, India
  • Ritvika Jalan Researcher, Shaheed Sukhdev College of Business Studies, New Delhi, India
  • Rohini Singh Associate Professor, Shaheed Sukhdev College of Business Studies, New Delhi, India


COVID-19, global equity markets, event study, Mann–Whitney U-test, S&P 100 index, t-test


Purpose: The aim of this research paper is to investigate the short-term financial impact of coronavirus disease
(COVID-19) on the leading stock markets indices of 20 countries, namely, India, the United States of America, Brazil,
Russia, the United Kingdom, Spain, China, Germany, South Korea, France, Abu Dhabi, Taiwan, Thailand, Pakistan,
New Zealand, Mexico, Japan, Canada, Singapore, and Australia. Methodology: A comparative and event study has
been conducted between index closing prices of aforementioned countries during the COVID-19 outbreak (short-term
and long-term basis) and pre-COVID period, keeping the S&P Global 100 closing prices as the benchmark. For this,
we have used statistical tools such as t-test and Mann–Whitney U-test and interpreted and analyzed the results thereof.
Findings: Since the reaction of aforementioned stock indices has been analyzed under varying time periods for the
event study, it was concluded that the announcement of the virus as a pandemic and its subsequent outbreak saw a
sudden decrease in market returns, however, the prices recovered quickly. Implication: Even though COVID-19
initially affected investor confidence, it failed to create a long-term impact. Originality: Till now, no research has
been conducted to test the effect of the WHO declaring COVID-19 a pandemic


Baker, S.R., Bloom, N., Davis, S.J., Kost, K.J., Sammon, M.C., Viratyosin, T. (2020). The

Unprecedented Stock Market Impact of COVID-19. Cambridge: The National Bureau of Economic

Research. Barro, R.J., Ursua, J.F., Weng, J. (2020). The Coronavirus

and the Great Influenza Epidemic: Lessons from the “Spanish Flu” for the Coronavirus’ Potential Effects

on Mortality and Economic Activity. Washington, DC: The American Enterprise Institute.

Business Standard. (2020). Lockdown Worsening Poverty Levels among Workers in Informal Economy: ILO.

Available from:

com/article/economy-policy/lockdown-worseningpoverty-levels-among-informal-economy-workersilo-120050900406_1.html. [Last accessed on 2020 Jul 15]. El-Erian, M.A. (2020). The Coming Coronavirus Recession

and the Uncharted Territory Beyond. Foreign Affairs. Available from:


[Last accessed on 2020 Jul 17]. Elliot, L. (2020). Prepare for the Coronavirus Global

Recession. The Guardian. Available from: https:// [Last accessed

on 2020 Jul 13]. Fisher, K.L., Statman, M. (2000). Investor sentiment and

stock returns, Financial Analysts Journal, 56(2), 16-23. IMF. (2020). The Great Lockdown: Worst Economic

Downturn since the Great Depression. Available from: [Last accessed on 2020 Jun 22].

IMF. (2020). Available from: News/Articles/2020/03/23/

pr2098-imf-managingdirector-statement-following-a-g20-ministerial-callon-the-coronavirus-emergency; external/index.htm. [Last accessed on 2020 Jun 22].

Liu, H.Y., Manzoor, A., Wang, C.Y., Zhang, L., Manzoor, Z. (2020). The COVID-19 outbreak

and affected countries stock markets response, International Journal of Environmental Research and

Public Health, 17(8), 2800. McGurk, Z., Nowak, A., Hall, J.C. (2020). Stock returns and

investor sentiment: Textual analysis and social media, Journal of Economics and Finance, 44, 458-485.

Medical News Today. (2020). Available from: https://www.; [Last accessed on 2020 Jun 22].

Nippani, S., Washer, K.M. (2004). SARS: A non-event for affected countries’ stock markets? Applied Financial

Economics, 14(15), 1105-1110. Ozili, P., Thankom, A. (2020). Spillover of COVID-19:

Impact on the global economy, SSRN Electronic Journal, 1, 2139.

Qiu, W., Chu, C., Mao, A., Wu, J. (2018). The impacts on health, society, and economy of SARS and H7N9

outbreaks in China: A case comparison study, Journal of Environmental and Public Health, 2018, 2710185.

Siddiqui, S. (2009). Stock markets integration: Examining linkages between selected world markets. Vision,

(1), 19-30. The Guardian. (2020). China Confirms Human-to-human Transmission of Coronavirus. Available from:

[Last accessed on 2020 Jul 18]. WHO. (2020). Available from: https://www.who.


-opening-remarks-at-the-media-briefing-on-covid-19 ---11-march-2020; [Last accessed

on 2020 Jun 20]. Zappa, A., Amendola, A., Romanò, L., Zanetti, A. (2009).

Emerging and re-emerging viruses in the era of globalisation. Blood Transfusion, 7(3), 167-171.




How to Cite

Mitashi Sinha, Ritvika Jalan, & Rohini Singh. (2021). Investigating the financial impact of coronavirus on leading stock indices. Indian Journal of Commerce and Management Studies, 11(3), 08–22. Retrieved from