Does war spread the herding effect in stock markets? Evidence from emerging and developed markets during the Russia-Ukraine war

Natividad Blasco, Luis Casas and Sandra Ferreruela

Finance Research Letters, 2024, vol. 63, issue C

Abstract: This paper investigates the influence of the Russia-Ukraine conflict on herding behavior in global stock markets. Examining MSCI World and MSCI Emerging indexes alongside Russia, the study explores imitation tendencies before the invasion, immediately after commencement of war, and during an extended war period. Findings reveal that emerging markets facing heightened geopolitical risk, either due to their proximity to the conflict or to commercial interests in energy markets, exhibit herding during the initial war phase. This analysis sheds light on the impact of geopolitical events on financial market dynamics, particularly in emerging economies.

Keywords: Herding; CSAD; Russia-Ukraine war; Geopolitical risk; MSCI (search for similar items in EconPapers)
JEL-codes: G14 G15 G4 (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:63:y:2024:i:c:s1544612324003957

DOI: 10.1016/j.frl.2024.105365

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