The Overflow Effect of Covid-19 Pandemic: Evidence from China and US Stock Market

Abstract

Since 2019, the new crown pandemic has spread around the world, causing immeasurable direct and indirect losses. Among them, the economic losses incurred by various countries are even more astronomical. It can be said that this is a heavy blow to the stock markets of various countries and even the global economic market. Therefore, this paper hopes to study the correlation between stock markets in different economies in response to the outbreak. Among them, this paper takes China and the United States as examples, and uses VAR, ARCH, ARMA and other economic quantitative analysis models to analyze the impact of the pandemic in other countries on their own economy, and finally draws a conclusion that it has a certain correlation. Therefore, investors should fully refer to the opinions given in this article when making investment planning. In addition to paying attention to the major events in the local market where the stock market is located, they cannot ignore the mutual influence of strongly correlated economies. Taking these two impact factors into consideration, this paper believes that a better investment portfolio can be obtained.