Characterizing the Impact of COVID-19 on the Global Stock Indices through Comparative Analysis

Abstract

This paper shows the impact of COVID-19 on the global stock indices through the use of comparative analysis. Stock indices are presented by regions (Africa, Americas, Europe, Asia, and Oceania) and national stock indices are compared based on historical data. A 2:4 month ratio is used as a “window” for observing the changes in the movement of the price of indices from November – December 2019 and January – May 2020 respectively. COVID-19 infection count, recovery rate, and death rate are identified in each country from the first case recorded up to May 20, 2020. Based on analysis it appeared that there is no sufficient evidence to conclude that the changes in the value of indices is affected by the COVID-19 infection count (p-value = 0.9129). In Africa, only INDZI (Zimbabwe) showed a positive change of price in percentage points (1.39%) for January to May 2020 with 51 confirmed COVID-19 cases. In Asia, only SZSE (China) showed a positive mean change of price in percentage points (0.07%) in the same period with 82,971 confirmed cases. Similarly, in Europe, only OMXC20 (Denmark) showed the same with (0.09%) with 11,182 confirmed cases. In the Americas, NYSE Arca (US), Nasdaq100 (US), and MERVAL (Argentina) showed a positive mean change in price in percentage points (0.31%, 0.20%, and 0.89%) with 1,620,902 and 9,918 confirmed cases respectively. On the other hand, in Oceania, both NZX 50 (New Zealand) and S&P/ASX20 (Australia) showed a negative mean change in prices (-0.03 & -0.15) respectively. In general Asian and European indices suffered a 0.28% decrease in the mean change in daily prices as compared during November to December 2019. African indices on average stood to be the least affected with 0.11% mean change in daily prices as compared to -0.02% from November to December 2019.