Impact of Covid-19 on corporate solvency and possible policy responses in the EU

Mirza, Nawazish; Rahat, Birjees; Naqvi, Bushra; Rizvi, Syed Kumail Abbas

doi:10.1016/j.qref.2020.09.002

Cited by 142 publications

(108 citation statements)

References 57 publications

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“…The COVID-19 outbreak has adversely affected firms' solvency (Mirza et al 2020), US stock markets (Shahzad et al 2021), and other financial markets (Bouri et al 2020). This can be true to the Asian stock markets that are globally and regionally integrated (e.g., Mohti et al (2019) and are closely linked with China due to the higher bilateral trade volume and foreign direct investment of China in Asian markets.…”

Section: Gold and Financial Markets During The Covid-19 Outbreakmentioning

confidence: 99%

Gold against Asian Stock Markets during the COVID-19 Outbreak

Yousaf

Bouri

Ali

et al. 2021

JRFM

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This study examines the safe-haven and hedging roles of gold against thirteen Asian stock markets during the COVID-19 outbreak. During the COVID-19 sub-period, gold is shown to be a strong hedge (diversifier) for the majority (minority) of Asian stock markets; it exhibits the property of a strong safe-haven in China, Indonesia, Singapore, and Vietnam, and a weak safe-haven in Pakistan and Thailand. The optimal weights of all stock-gold portfolios are lower during the COVID-19 sub-period than the pre COVID-19 sub-period, suggesting that portfolio investors should increase their investment in gold during the COVID-19 sub-period. The hedging effectiveness for most Asian stock markets is higher during the COVID-19 sub-period. Further analyses show that the hedge portfolio returns in many cases are mostly driven by gold implied volatility and inflation expectations in both sub-periods. Our findings have useful implications for market participants holding investments in Asian stocks during stressful periods.

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Section: Gold and Financial Markets During The Covid-19 Outbreakmentioning

confidence: 99%

Gold against Asian Stock Markets during the COVID-19 Outbreak

Yousaf

Bouri

Ali

et al. 2021

JRFM

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“…It increased uncertainty in financial markets, which dragged stock market volatility into a hostile region (W. , halting market stability (Mirza et al, 2020a;Rizvi et al, 2020). This led to a new argument, linking the fear index of infectious disease and, simultaneously, the coronavirus, with a severe effect on stock market volatility (Alemzero et al, 2020a;2020b;Mirza et al, 2020b;Yarovaya et al, 2021). Such conditions favour the activities, balance, and growth of business.…”

Section: Introductionmentioning

confidence: 99%

The nexus between COVID-19 fear and stock market volatility

Chien

Kamran

et al. 2021

Economic Research-Ekonomska Istraživanja

150

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This study described an empirical link between COVID-19 fear and stock market volatility. Studying COVID-19 fear with stock market volatility is crucial for planning adequate portfolio diversification in international financial markets. The study used AR (1) -GARCH (1,1) to measure stock market volatility associated with the COVID-19 pandemic. Our findings suggest that COVID-19 fear is the ultimate cause driving public attention and stock market volatility. The results demonstrate that stock market performance and GDP growth decreased significantly through average increases during the pandemic. Further, with a 1% increase in COVID-19 cases, the stock return and GDP decreased by 0.8%, 0.56%, respectively. However, GDP growth demonstrated a slight movement with stock exchange. Moreover, public attention to the attitude of buying or selling was highly dependent on the COVID-19 pandemic reported cases index, death index, and global fear index. Consequently, investment in the gold market, rather than in the stock market, is recommended. The study also suggests policy implications for key stakeholders.

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“…Although the impact on industries was asymmetrical, with deep negative consequences for some industries and growth in others, the normal rhythm was reduced by one fifth in both daily activity (Staszkiewicz et al, 2020) and financial markets (Rizvi et al, 2020). Therefore, the literature on Covid-19 impact is growing, encompassing a wide range of studies, from the impact on businesses and corporate solvency (Mirza et al, 2020 b), the equity funds' performance and human capital efficiency (Mirza et al, 2020c;Yarovaya et al, 2021), to the evolution of cryptocurrencies (Corbet et al, 2020;Goodell and Goutte, (2020) and the list goes on.…”

Section: Introductionmentioning

confidence: 99%

An empirical analysis using panel data gravity models and scenario forecast simulations for the Romanian exports in the context of COVID-19

Davidescu

Popovici

Strat

2021

Economic Research-Ekonomska Istraživanja

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The paper focuses on the trade performance of Romania, a representative country for the Central and Eastern European region, strongly connected with its European partners in global value chains and thus affected by any change in these countries' relationships with the rest of the world in general and China in particular. Using panel data gravity models for the 2008-2019 period, we find that Romania's exports are significantly influenced by the demand of its major trade partners in the EU, and imports from China and the rest of the world. In addition, exports are vulnerable to the effectiveness of the government in relation to the other countries, corruption control and cultural values such as collectivism. We also assess the capacity of Romanian exports to regain their ascending trend displayed before the COVID-19 pandemic by using simulation forecasting scenarios based on the shape of the economic recovery and the type of shock transmission across economies. We observe a sharp decrease in 2020 followed by an important recovery in 2021 in a V-shape scenario and uniform transmission of the pandemic shock in the internal demand and in the foreign trade, or followed by a very slow recovery in 2021 (in a U-shape scenario and non-uniform transmission type in the two previously mentioned elements), especially when the global relation with rest of the world is included.

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Impact of Covid-19 on corporate solvency and possible policy responses in the EU

Cited by 142 publications

References 57 publications

Gold against Asian Stock Markets during the COVID-19 Outbreak

Gold against Asian Stock Markets during the COVID-19 Outbreak

The nexus between COVID-19 fear and stock market volatility

An empirical analysis using panel data gravity models and scenario forecast simulations for the Romanian exports in the context of COVID-19

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