Stock market effects of military conflicts on defence industry

IF 2.8 3区经济学 Q2 BUSINESS, FINANCE International Journal of Islamic and Middle Eastern Finance and Management Pub Date : 2024-08-05 DOI:10.1108/imefm-01-2024-0019

António Miguel Martins

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Abstract

Purpose

This paper aims to examine the short-term market reaction for the world’s 100 largest listed defence firms at and around the three recent largest threats to the global economy – Ukraine–Russia war, Fourth Taiwan Strait Crisis and the Hamas terrorist attack on Israel.

Design/methodology/approach

The author examine the impact of the three recent largest threats to the global economy in the largest listed defence firms using an event study methodology.

Findings

The results show a positive and statistically significant short-term reaction around the three geopolitical threats. The results also reveal the existence of higher abnormal returns for defence firms with greater weight of defence sales, in line with the captured regulator theory and for firms with higher research and development and capital expenditure intensity.

Originality/value

The effect of the war on stock markets has been relatively little examined in the financial theory. This study intends to fill this gap in the literature through the analysis of the three recent largest threats to the global economy.

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军事冲突对国防工业股市的影响

本文旨在研究全球 100 家最大的上市防务公司在近期全球经济面临的三大威胁（乌克兰-俄罗斯战争、第四次台湾海峡危机和哈马斯对以色列的恐怖袭击）时及其前后的短期市场反应。作者采用事件研究法研究了近期全球经济面临的三大威胁对最大的上市防务公司的影响。结果还显示，国防销售比重较大的国防公司存在较高的异常回报，这与俘获监管者理论以及研发和资本支出强度较高的公司相一致。本研究旨在通过分析近期全球经济面临的三大威胁来填补这一文献空白。

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来源期刊

International Journal of Islamic and Middle Eastern Finance and Management Multiple-

CiteScore

5.40

自引率

10.00%

发文量

期刊介绍： The International Journal of Islamic and Middle Eastern Finance and Management (IMEFM) publishes quality and in-depth analysis on current issues within Islamic and Middle Eastern finance and management. The journal welcomes strong evidence-based empirical studies and results-focused case studies that share research in product development and clarify best practices. The title is also keen to consider work from emerging authors. IMEFM has just also accepted into Clarivate''s SSCI in 2018, and its IF will be available in summer 2019, with citations dating from 2016. The coverage includes but is not limited to: -Islamic finance: Fundamentals, trends and opportunities in Islamic Finance, Islamic banking and financial markets, Risk management, Corporate finance, Investment strategy, Islamic social finance, Financial planning, Housing finance, Legal and regulatory issues, -Islamic management: Corporate governance, Customer relationship management and service quality, Business ethics and corporate social responsibility, Management styles and strategies in Shariah environments, Labour and welfare economics, Political economy. The journal is the only title aiming to give an interdisciplinary and holistic view on Islamic finance and business management practices in order to inform these two intertwined communities.