Trump’s Effect on the Chinese Stock Market

Shijun Guo, Yang Jiao and Zhiwei Xu ()

Journal of Asian Economics, 2021, vol. 72, issue C

Abstract: U.S. President Donald J. Trump tweets frequently to communicate his thoughts to the public. We quantitatively evaluate the impact of Trump's China-related tweets on the Chinese stock market. We find that following Trump’s inauguration, his tweets with a positive sentiment significantly increase abnormal returns for the manufacturing industry in the Chinese stock market. Furthermore, an increase in the absolute value of his positive sentiment increases both the trading volume and volatility of the market. The positive effect is more pronounced for those subindustries with high exposure to international trade and stronger business relations with the United States than for other subindustries. The results are robust for various sensitivity tests.

Keywords: Social media; Trump’s effect; Stock market; Asset pricing (search for similar items in EconPapers)
JEL-codes: F30 G11 G15 G40 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:asieco:v:72:y:2021:i:c:s1049007820301470

DOI: 10.1016/j.asieco.2020.101267

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