Resilience in Jordan’s Stock Market: Sectoral Volatility Responses to Financial, Political, and Health Crises

Abdulrahman Alnatour ()
Additional contact information
Abdulrahman Alnatour: Accounting Department, College of Business Administration, American University of the Middle East, Egaila 54206, Kuwait

Risks, 2025, vol. 13, issue 10, 1-25

Abstract: Sectoral vulnerability to distinct crisis types in small, open, and geopolitically exposed markets—such as Jordan—remains insufficiently quantified, constraining targeted policy design and portfolio allocation. This study’s primary purpose is to establish a transparent, comparable metric of sector-level market resilience that reveals how crisis typology reorders vulnerabilities and shapes recovery speed. Applying this framework, we assess Jordan’s equity market across three archetypal episodes—the Global Financial Crisis, the Arab Spring, and COVID-19—to clarify how shock channels reconfigure sectoral risk. Using daily Amman Stock Exchange sector indices (2001–2025), we estimate G A R C H ( 1,1 ) models for each sector–crisis window and summarize volatility dynamics by persistence ( α + β ) , interpreted as an inverse proxy for resilience; complementary diagnostics include maximum drawdown and days-to-recovery, with nonparametric (Kruskal–Wallis) and rank-based (Spearman, Friedman) tests to evaluate within-crisis differences and cross-crisis reordering. Results show pronounced heterogeneity in every crisis and shifting sectoral rankings: financials—especially banking—display the highest persistence during the GFC; tourism and transportation dominate during COVID-19; and tourism/electric-related industries are most persistent around the Arab Spring. Meanwhile, food & beverages, pharmaceuticals/medical, and education recurrently exhibit lower persistence. Higher persistence aligns with slower post-shock normalization. We conclude that resilience is sector-specific and contingent on crisis characteristics, implying targeted policy and portfolio responses; regulators should prioritize liquidity backstops, timely disclosure, and contingency planning for fragile sectors, while investors can mitigate crisis risk via dynamic sector allocation and volatility-aware risk management in emerging markets.

Keywords: market resilience; volatility persistence; Amman Stock Exchange (ASE); financial crisis; Arab Spring; COVID-19 (search for similar items in EconPapers)
JEL-codes: C G0 G1 G2 G3 K2 M2 M4 (search for similar items in EconPapers)
Date: 2025
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.mdpi.com/2227-9091/13/10/194/pdf (application/pdf)
https://www.mdpi.com/2227-9091/13/10/194/ (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:gam:jrisks:v:13:y:2025:i:10:p:194-:d:1764798

Access Statistics for this article

Risks is currently edited by Mr. Claude Zhang

More articles in Risks from MDPI
Bibliographic data for series maintained by MDPI Indexing Manager ().