The Causal Relationship Between Coronavirus (COVID-19) and Stock Indices: A Case Study for G20 Countries

ABSTRACT

Coronavirus (COVID-19 or SARS-CoV-2) spreads rapidly around the world. Coronavirus reached 8,000 cases on Jan 30, 2020. When the cases that lost their lives were examined, the majority of them were found to be elderly patients or patients diagnosed with chronic heart, lung and kidney, Parkinson's, and Diabetes. The number of cases worldwide was 509,164, the number of deaths worldwide was 23,335 while analyzing this study. COVID-19 also affected many economic variables in the world. Some of these variables are stock indices. In this study, it is aimed to discover the causal relationship between stock indices and coronavirus. Daily data were used in the research. Stock indices and total deaths and total cases of coronavirus are matched for each country. Unit root tests, Pairwise Granger Causality Tests, and regression analysis were made. The stationarity and level of significance were calculated. Causality Tests used to test hypotheses regarding the presence and the direction of causality. © 2023, The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd.