Is there an impact of COVID-19 on the returns of the Amman Stock Exchange?
-
Author(s)Buthiena KharabshehLink to ORCID Index: https://orcid.org/0000-0001-7142-6656
,
Omar K. GharaibehLink to ORCID Index: https://orcid.org/0000-0002-2020-6597
,
Aseel Mahafza
-
DOIhttp://dx.doi.org/10.21511/imfi.19(2).2022.03
-
Article InfoVolume 19 2022, Issue #2, pp. 24-36
- Cited by
- 656 Views
-
296 Downloads
This work is licensed under a
Creative Commons Attribution 4.0 International License
This study examines the effect of the COVID-19 pandemic on the performance of the main indices and corporate returns in Jordan. The study employs two samples and two levels of analysis. The first one considers the effect of daily cumulative confirmed cases of COVID-19 on the daily return of the main index and sub-indices of the Amman Stock Exchange (ASE). The time-series analysis shows that there is a strong negative impact of the daily cumulative confirmed cases of COVID-19 on the daily return of the Amman Stock Exchange index. The results also indicate that the financial sector is the most affected during the epidemic, followed by the service and industry sectors. The insurance sector is positively affected, but not statistically significant.
The second level of analysis aims to test how different corporate financial characteristics might affect corporate immunity during the pandemic period. The sample includes all non-financial firms listed on ASE, with a total of 75 firms. Based on quarterly data, the findings show a statistically significant negative effect of the COVID-19 pandemic on non-financial corporate stock returns. Further, the evidence shows that larger firms with higher levels of cash holding have better immunity and thus experience higher returns during the pandemic period.
- Keywords
-
JEL Classification (Paper profile tab)G10, G14
-
References36
-
Tables8
-
Figures5
-
- Figure 1. ASE index during the pandemic
- Figure 2. Bank indices during the pandemic
- Figure 3. Industry index during the pandemic
- Figure 4. Service index during the pandemic
- Figure 5. Insurance index during the pandemic
-
- Table 1. ASE daily returns
- Table 2. Descriptive statistics
- Table 3. Correlation matrix
- Table 4. VIF
- Table 5. General market index and confirmed cases of COVID-19
- Table 6. Sub-indices’ return and confirmed cases of COVID-19
- Table 7. Corporate immunity to the accumulated COVID-19 pandemic
- Table 8. Corporate immunity to the accumulated COVID-19 pandemic
-
- Abu-Lila, Z. M. (2021). Determinants of Investment in the Jordanian Productive Sectors. The Journal of Asian Finance, Economics and Business, 8(4), 635-641.
- Alam, M. N., Alam, M. S., & Chavali, K. (2020). Stock market response during COVID-19 lockdown period in India: An event study. The Journal of Asian Finance, Economics, and Business, 7(7), 131-137.
- Almarayeh, T. (2020). COVID-19 and Stock Markets Response in Developing Countries. The Case of MENA Countries. The Case of MENA Countries (June 16, 2020).
- Al-Qudah, A. A., & Houcine, A. (2021). Stock markets’ reaction to COVID-19: evidence from the six WHO regions. Journal of Economic Studies.
- Anh, D. L. T., & Gan, C. (2020). The impact of the COVID-19 lockdown on stock market performance: evidence from Vietnam. Journal of Economic Studies, 48(4), 836-851.
- 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 (Working Paper 26945). Cambridge, MA: National Bureau of Economic Research.
- Barberis, N., Shleifer, A., & Vishny, R. (1998). A model of investor sentiment. Journal of Financial Economics, 49(3), 307-343.
- Barro, R. J., Ursúa, J. F., & Weng, J. (2020). The Coronavirus and the Great Influenza Pandemic: Lessons from the ‘Spanish Flu’ for the Coronavirus’s Potential Effects on Mortality and Economic Activity (National Bureau of Economic Research Working Papers, No. w26866).
- Burns, W. J., Peters, E., & Slovic, P. (2012). Risk perception and the economic crisis: A longitudinal study of the trajectory of perceived risk. Risk Analysis: An International Journal, 32(4), 659-677.
- Cote, J., & Sanders, D. (1997). Herding behavior: Explanations and implications. Behavioral Research in Accounting, 9.
- Daniel, K., Hirshleifer, D., & Subrahmanyam, A. (1998). Investor psychology and security market under-and overreactions. The Journal of Finance, 53(6), 1839-1885.
- Demir, E., & Danisman, G. O. (2020). Is COVID-19 an indiscriminate tsunami? Bank immunity and variation in government policy responses.
- Ding, W., Levine, R., Lin, C., & Xie, W. (2020). Corporate immunity to the COVID-19 Pandemic (NBER Working Paper No. 27055).
- Elder, J., & Serletis, A. (2010). Oil price uncertainty. Journal of Money, Credit and Banking, 42(6), 1137-1159.
- Fama, E. F. (1970). Efficient Capital Markets: A Review of Theory and Empirical Work. The Journal of Finance, 25(2), 383-417.
- Gujarati, D. (2004). Basic Econometrics. New York: McGraw-Hill.
- Harjoto, M. A., Rossi, F., & Paglia, J. K. (2020). COVID-19: Stock market reactions to the shock and the stimulus. Available at SSRN 3622899.
- He, P., Sun, Y., Zhang, Y., & Li, T. (2020). COVID-19’s impact on stock prices across different sectors – An event study based on the Chinese stock market. Emerging Markets Finance and Trade, 56(10), 2198-2212.
- Hirshleifer, D. (2001). Investor psychology and asset pricing. The Journal of Finance, 56(4), 1533-1597.
- Hong, H., & Stein, J. C. (1999). A unified theory of underreaction, momentum trading, and overreaction in asset markets. The Journal of Finance, 54(6), 2143-2184.
- Liu, H., Manzoor, A., Wang, C., 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.
- Mazur, M., Dang, M., & Vega, M. (2021). COVID-19 and the march 2020 stock market crash. Evidence from S&P1500. Finance Research Letters, 38, 101690.
- Narayan, P. K., Gong, Q., & Aliahmed, H. J. (2021). Is there a pattern in how COVID-19 has affected Australia’s stock returns? Applied Economics Letters, 1-4.
- Nia, V. M. (2020). The effect of corona outbreak on the Indonesian stock market. American Journal of Humanities and Social Sciences Research, 4(3), 358-370.
- Ramelli, S., & Wagner, A. F. (2020). Feverish stock price reactions to COVID-19. The Review of Corporate Finance Studies, 9(3), 622-655.
- Shiller, R. J. (2003). From efficient markets theory to behavioral finance. Journal of Economic Perspectives, 17(1), 83-104.
- Shleifer, A., & Summers, L. H. (1990). The noise trader approach to finance. Journal of Economic Perspectives, 4(2), 19-33.
- Shu, H.-C. (2010). Investor mood and financial markets. Journal of Economic Behavior & Organization, 76(2), 267-282.
- Tan, L., Chiang, T. C., Mason, J. R., & Nelling, E. (2008). Herding behavior in Chinese stock markets: An examination of A and B shares. Pacific-Basin Finance Journal, 16(1-2), 61-77.
- Topcu, M., & Gulal, O. S. (2020). The impact of COVID-19 on emerging stock markets. Finance Research Letters, 36, 101691.
- Trueman, B. (1994). Analyst forecasts and herding behavior. The Review of Financial Studies, 7(1), 97-124.
- Waheed, R., Wei, C., Sarwar, S., Lv, Y., 2017. Impact of oil prices on firm stock return: industry-wise analysis. Empirical Economics, 1-16.
- Xiong, H., Wu, Z., Hou, F., & Zhang, J. (2020). Which firm-specific characteristics affect the market reaction of Chinese listed companies to the COVID-19 pandemic? Emerging Markets Finance and Trade, 56(10), 2231-2242.
- Xu, L. (2021). Stock Return and the COVID-19 pandemic: Evidence from Canada and the US. Finance Research Letters, 38(1), 101872.
- Zaremba, A., Kizys, R., Aharon, D. Y., & Demir, E. (2020). Infected markets: Novel coronavirus, government interventions, and stock return volatility around the globe. Finance Research Letters, 35, 101597.
- Zaremba, A., Aharon, D. Y., Demir, E., Kizys, R., & Zawadka, D. (2021). COVID-19, Government Policy Responses, and Stock Market Liquidity Around The World. A Note. Research in International Business and Finance, 56.
-
The impact of COVID-19 on the transportation and logistics industry
Dalia Perkumiene ,
Agbonmere Osamede ,
Regina Andriukaitienė ,
Olegas Beriozovas
doi: http://dx.doi.org/10.21511/ppm.19(4).2021.37
Problems and Perspectives in Management Volume 19, 2021 Issue #4 pp. 458-469 Views: 5630 Downloads: 9927 TO CITE АНОТАЦІЯIn this present age of globalization, the logistics and transportation industry has become an integral part of most businesses/firms as it is aimed at ensuring the effective movement of people, distribution of goods and services from one location to another on time. Therefore, this paper aims to analyze the impact of COVID-19 on the logistics and transportation sectors. The qualitative research approach was adopted using analysis and synthesis of scientific literature, data from news reports, organizational sites, and a case study of data contents. The paper presented the analysis of negative and positive effects of COVID-19 on the logistics and transportation industry. The study also discusses possible strategies and further steps for improvement of the logistics and transportation sector, including the automation and introduction of other technologies, a sustainable and flexible transportation system, cooperation of logistics and transportation business. Findings regarding the positive implications of COVID-19 show noticeable advancements in the logistics and transportation sector, such as the rise of e-commerce businesses with efficient delivery options, and the development of 3rd party logistics services as more companies outsource supply chain operations. The study revealed the importance of strategic planning with a joint effort from the research centers, public sector, private sector, and educational institutions as one of the proposed solutions for the logistics and transportation industry.
-
The impact of social distancing policy on small and medium-sized enterprises (SMEs) in Indonesia
Muhtar Lutfi ,
Pricylia Chintya Dewi Buntuang ,
Yoberth Kornelius ,
Erdiyansyah ,
Bakri Hasanuddin
doi: http://dx.doi.org/10.21511/ppm.18(3).2020.40
Problems and Perspectives in Management Volume 18, 2020 Issue #3 pp. 492-503 Views: 3403 Downloads: 1267 TO CITE АНОТАЦІЯThis study aims to investigate the impact of social distancing policies on SMEs in Indonesia. It used a quantitative method with a survey design. Respondents were all SMEs in Indonesia that are affected by social distancing policies during the COVID-19 pandemic. It involved a total of 587 SME samples selected randomly. The data were collected through observations, questionnaires, and literature studies. The collected data were analyzed using descriptive statistics with SPSS software to determine the mean value. The result showed that social distancing policies affect SMEs during the COVID-19 pandemic. This is indicated by the decreasing income and demand for SMEs products, and even some have no income (mean values of 2.40) due to the social distancing policies. Besides, the policy’s impact is also shown in the increasing cost of raw materials and production costs due to supply chain problems (mean values of 4.79). The policy’s impact raises anxiety for SMEs to survive so that business actors change their plans by utilizing information technology (mean values of 4.81). This change is a strategy to survive due to the impact of the applied policies. Although social distancing policies affect SMEs’ survival during the pandemic, research findings show that SMEs in Indonesia did not terminate employment (mean values of 4.37) due to the presence of economic stimulus policies that helped SMEs survive and grow during the COVID-19 pandemic.
-
The impact of the COVID-19 pandemic on retailer performance: empirical evidence from India
Amgad S.D. Khaled ,
Nabil Mohamed Alabsy ,
Eissa A. Al-Homaidi 
,
Abdulmalek M.M. Saeed
doi: http://dx.doi.org/10.21511/im.16(4).2020.11
Innovative Marketing Volume 16, 2020 Issue #4 pp. 129-138 Views: 3154 Downloads: 5735 TO CITE АНОТАЦІЯThe study aims to synthesize the challenges that retailers are facing during the COVID-19 emergency. The research is definitive, informative, and based on a single design of cross-sectional research. Quantitative data based on the research instrument were produced (a questionnaire). Five hundred responses were collected from employees of major retail stores in India. Retailer performance is considered a dependent variable, whereas employee well-being, customer and brand protection, use of technology, government policies, and supply chain are used as independent variables. The current study results indicated that employee well-being and government policies have a significant positive impact on retailer performance, while customer and brand protection, use of technology, and supply chain have a significant positive impact on retailers’ performance. This study will help retailers develop strategies for their employees to protect them and understand that technology is needed in the new normal times. This study highlights the need to be flexible in executing strategic strategies, but retailers need to develop comprehensive action plans, including selecting managers of initiative and defining goals and deadlines. Provided that retailers’ current reality is different from the old normal, no time is lost in taking audacious action.
