Impact of Covid-19 on the Malaysian stock market

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Goh, Yi Min (2021) Impact of Covid-19 on the Malaysian stock market. [Dissertation (University of Nottingham only)]

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Abstract

Since its beginning of first case in Wuhan, China, the COVID-19 pandemic has caused a havoc around the world resulting in more than 31 million confirmed cases (22 September 2020). COVID19 pandemic was first declared as pandemic on March 11 by the World Health Organisation. The pandemic has triggered a major impact on global economic activity and in turn affected the global financial market, including Malaysia.

This study examines the response of Malaysian stock market amid of the COVID-19 pandemic from January 22 to July 31, 2020. The dependent variables utilised in present study comprise of the major stock index in Malaysia, FTSE KLCI and 13 sectors stock indices. The independent variable utilised comprise of (i) the growth in COVID-19 confirmed cases, death cases, and recovered cases in Malaysia; (ii) 2 government response index (containment and health index; economic support index); and (iii) 3 stock returns of top FDI countries in Malaysia (Japan; Hong Kong; UK).

The findings indicated that COVID-19 cases have both positive and negative significant impact on Malaysian stock returns. Further results show that the stock performance of Hang Seng and Nikkei 225 have significant positive impact on Malaysian stock returns. Lastly, this study finds mixed results over the government response interaction terms and Malaysian stock market.

This study adds to existing literatures that examines the pandemic effect on stock returns as well as studies on the COVID-19 impact on stock performances. As well, this study has provided a further indication that there is a relation between Malaysian stock performance and FDI countries, in which this study has utilised the FDI countries’ stock indices. Finally, this study has provided an insight for policymakers on the extend of the government’s response have on Malaysian financial market.

Item Type: Dissertation (University of Nottingham only)
Depositing User: Goh, Yi
Date Deposited: 16 Apr 2021 03:32
Last Modified: 17 Mar 2022 06:31
URI: https://eprints.nottingham.ac.uk/id/eprint/63248

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