THE IMPACT OF TERRORISM ON FINANCIAL MARKETS: EVIDENCE FROM ASIA

Faheem Aslam, Amir Rafique (), Aneel Salman (), Hyoung-Goo Kang () and Wahbeeah Mohti ()
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Faheem Aslam: Department of Management Sciences, COMSATS Institute of Information Technology, Islamabad, Pakistan
Amir Rafique: Department of Management Sciences, COMSATS Institute of Information Technology, Islamabad, Pakistan
Aneel Salman: Department of Management Sciences, COMSATS Institute of Information Technology, Islamabad, Pakistan
Hyoung-Goo Kang: Department of Finance, Hanyang University Business School, Seoul, South Korea
Wahbeeah Mohti: Department of Management Sciences, Muhammad Ali Jinnah University, Islamabad, Pakistan

The Singapore Economic Review (SER), 2018, vol. 63, issue 05, 1183-1204

Abstract: This paper examines the impact of 410 terrorist attacks on the performance of five Asian stock markets. The empirical findings indicate that terrorism has a significant impact on the stock markets. Furthermore, the magnitude of these effects varies with respect to country, attack type, target type and severity of the attacks. In target type, terrorist attacks on business sector and security forces are particularly destructive for the stock markets. Likewise, in attack type, suicide attacks and bomb blasts particularly generate a significant downward movement in the stock markets. Furthermore, the more severe attacks have larger negative impact on market returns.

Keywords: Asian equity markets; terrorism; geopolitical risk; event study; stock market (search for similar items in EconPapers)
Date: 2018
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Citations: View citations in EconPapers (2)

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DOI: 10.1142/S0217590815501118

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