Global financial crisis and COVID-19: Industrial reactions

Hsuan-Chi Chen; Chia-Wei Yeh

doi:10.1016/j.frl.2021.101940

Global financial crisis and COVID-19: Industrial reactions

Financ Res Lett. 2021 Oct:42:101940. doi: 10.1016/j.frl.2021.101940. Epub 2021 Jan 19.

Authors

Hsuan-Chi Chen¹, Chia-Wei Yeh²

Affiliations

¹ Anderson School of Management, University of New Mexico, Albuquerque, NM 87131, USA.
² Department of Banking and Finance, National Chi Nan University, Nantou County 545, Taiwan.

Abstract

We study industrial reactions to both the global financial crisis of 2008 and the COVID-19 pandemic. Although most industries in the U.S. suffered from the two events, the stock performance of most industries started to recover following the announcements of quantitative easing. Our results indicate that quantitative easing is effective in boosting investor confidence. We also find that the effect of quantitative easing in 2020 on stock performance is more significant for the industries that are more affected by the pandemic.

Keywords: COVID-19; Global financial crisis; Quantitative easing; Stock market.