China-U.S. Trade Frictions, Opinion Divergence, and Stock Volatilities

Wenjia Zhang

International Journal of Economics and Finance, 2021, vol. 13, issue 6, 19

Abstract: China-US economic relation is of particular significance to the world economy. This paper aims to investigate how trade frictions influence Chinese stock market volatilities. Overall, trade frictions significantly increase large stocks' volatilities, whereas influences the SMEs differently before and after the 301 investigation. For the big caps (SSE50), opinion divergence has a partial mediation effect between trade frictions and market volatilities. Trade frictions lead to higher opinion divergence, and opinion divergence reduces market volatility before the 301 investigation and increases market volatility in Stages IV and V. This result is robust after controlling the endogeneity of opinion divergence. For the small caps (SMEs), the mediation effect has not been founddetected, but opinion divergence significantly influences stock volatility, negative before the Section 301 investigation, whereas positive after that.

Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.ccsenet.org/journal/index.php/ijef/article/download/0/0/45259/48007 (application/pdf)
http://www.ccsenet.org/journal/index.php/ijef/article/view/0/45259 (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:ibn:ijefaa:v:13:y:2021:i:6:p:19

Access Statistics for this article

More articles in International Journal of Economics and Finance from Canadian Center of Science and Education Contact information at EDIRC.
Bibliographic data for series maintained by Canadian Center of Science and Education ().