The Impact of Oil Price Fluctuations on Industry Stock Returns: Evidence from International Markets

2018 ◽  
Vol 5 (1) ◽  
pp. 1-12
Author(s):  
Elias Randjbaran ◽  
Reza Tahmoorespour ◽  
Marjan Rezvani ◽  
Meysam Safari
Keyword(s):  
Stock Returns ◽  
Oil And Gas ◽  
Negative Relationship ◽  
The United States ◽  
Oil Price ◽  
Price Variation ◽  
Price Changes ◽  
Price Fluctuations ◽  
Food And Beverage ◽  
The Impact

This study investigates the impact of oil price variation on 14 industries in six markets, including Canada, China, France, India, the United Kingdom, and the United States. Panel weekly data were collected from June 1998 to December 2011. The results indicate that price fluctuations primarily affect the Oil and Gas as well as the Mining industries and have the least influence on the Food and Beverage industry. Furthermore, in three out of six of these countries (Canada, France, and the U.K.), oil price changes negatively affect the Pharmaceutical and Biotechnology industry. One possible reason for the negative relationship between oil price changes and the Pharmaceutical and Biotechnology industries in the above-mentioned countries is that the governments of these countries fund their healthcare systems. Portfolio managers and investors will find the results of this study useful because it enables adjusting portfolios based on knowledge of the industries that are impacted the most or the least by oil price fluctuations.

scholarly journals Pengaruh Faktor Internal dan Eksternal Terhadap Return Saham Perusahaan Makanan dan Minuman di Bursa Efek Indonesia Periode 2008–2011

2019 ◽  
Vol 6 (2) ◽  
pp. 100
Author(s):  
Erric Wijaya ◽  
Tinjung Desy Nursanti
Keyword(s):  
Economic Growth ◽  
Interest Rate ◽  
Stock Returns ◽  
Stock Return ◽  
Stock Exchange ◽  
Negative Relationship ◽  
External Factors ◽  
Beverage Industry ◽  
Food And Beverage ◽  
The Impact

This study aims to look at the impact of internal and external factors to the stock return of food and beverage companies listed in the Indonesia Stock Exchange 2008 to 2011 period. The method used is the regression equation analysis of panel data using a common effect type.The results show that the internal factors such current ratio, debt to equity ratio and return on assets showed a positive and significant influence on the company's stock return of food and beverage industry in the BEI. While external factors namely SBI interest rate and economic growth showed a different result, where the SBI interest rate has a negative and significant relationship to the company's stock return, while economic growth has no significant negative relationship to the stock returns.

scholarly journals Oil price fluctuations and economic growth: the case of MENA countries

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Mamdouh Abdelmoula Mohamed Abdelsalam
Keyword(s):  
Economic Growth ◽  
Linear Models ◽  
Oil Prices ◽  
Oil Price ◽  
Price Changes ◽  
Content Type ◽  
Price Fluctuations ◽  
Mena Countries ◽  
Negative Effect ◽  
The Impact

Purpose This paper aims to explore the extreme effect of crude oil price fluctuations and its volatility on the economic growth of Middle East and North Africa (MENA) countries. It also investigates the asymmetric and dynamic relationship between oil price and economic growth. Further, a separate analysis for each MENA oil-export and oil-import countries is conducted. Furthermore, it studies to what extent the quality of institutions will change the effect of oil price fluctuations on economic growth. Design/methodology/approach As the effect of oil price fluctuations is not the same over different business cycles or oil price levels, the paper uses a panel quantile regression approach with other linear models such as fixed effects, random effects and panel generalized method of moments. The panel quantile methodology is an extension of traditional linear models and it has the advantage of exploring the relationship over the different quantiles of the whole distribution. Findings The paper can summarize results as following: changes in oil price and its volatility have an opposite effect for each oil-export and oil-import countries; for the former, changes in oil prices have a positive impact but the volatility a negative effect. While for the latter, changes in oil prices have a negative effect but volatility a positive effect. Further, the impact of oil price changes and their uncertainty are different across different quantiles. Furthermore, there is evidence about the asymmetric effect of the oil price changes on economic growth. Finally, accounting for institutional quality led to a reduction in the impact of oil price changes on economic growth. Originality/value The study concludes more detailed results on the impact of oil prices on gross domestic product growth. Thus, it can be used as a decision-support tool for policymakers.

DAMPAK VOLATILITAS HARGA MINYAK DI INDONESIA TERHADAP PENYESUAIAN KESEIMBANGAN FISKAL

2015 ◽  
Vol 15 (2) ◽  
pp. 37-52
Author(s):  
Mahpud Sujai
Keyword(s):  
Linear Trend ◽  
The State ◽  
Oil Price ◽  
Output Gap ◽  
State Budget ◽  
Price Changes ◽  
Potential Output ◽  
Budget Cycle ◽  
Actual Output ◽  
The Impact

This paper is intended to analyze the effect of oil price changes on potential output and actual output in the state budget cycle and identifies the output gap which is the difference between potential output and actual output. The research methodology uses a quantitative approach to analyze problems that occur related to the impact of oil price changes to the state budget cycle. Data analysis was carried out through the approach cyclically adjusted fiscal balance with a simplified approach. This research identified that the potential output is likely to continue increasing in line with Indonesia's oil price trends which is continue to rise following the world oil price movements. In calculating the output gap using a linear trend and HP filter, the result is fuctuating depend on the percentage changes in both potential output and actual output. This paper concludes that Indonesian oil price (ICP) has a significant impact on changes in the state budget cycle. If oil prices rise, the output gap between potential output and actual output is greater, and vice versa. This will make the budget vulnerable to shock that occurs as an external infuence.

The Effects of Oil Prices Changes on Output Growth and Inflation: Evidence from Turkey

2013 ◽  
Vol 5 (11) ◽  
pp. 730-739 ◽  
Author(s):  
Pelin ÖGE GÜNEY
Keyword(s):  
Time Series Data ◽  
Output Growth ◽  
Oil Price ◽  
Series Data ◽  
Negative Effects ◽  
Price Changes ◽  
Asymmetric Effects ◽  
Price Increases ◽  
Causality Tests ◽  
The Impact

This paper investigates the effects of oil price changes on output and inflation for the case of Turkey using monthly time series data for the period 1990:1–2012:3. Recent studies suggest that oil price changes may have asymmetric effects on the macroeconomic variables. To account for asymmetric effects, we decompose oil price changes into positive and negative parts following Hamilton (1996). Our results show that while oil price increases have clear negative effects on output growth, the impact of oil price decline is insignificant. Similarly, oil price increases have positive and significant effects on inflation. However, oil price declines have not a significant effect on inflation. The Granger causality tests also support these results.

Does the second wave of COVID-19 undermine corporate immunity? International evidence

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Huy Viet Hoang ◽  
Cuong Nguyen ◽  
Khanh Hoang
Keyword(s):  
Stock Returns ◽  
Stock Price ◽  
Fixed Effects ◽  
Management Strategies ◽  
The United States ◽  
Least Square ◽  
Content Type ◽  
The Impact ◽  
Second Wave ◽  
Practical Implications

PurposeThis study compares the impact of the COVID-19 pandemic on stock returns in the first two waves of infection across selected markets, given built-in corporate immunity before the global outbreak.Design/methodology/approachThe data are collected from listed firms in five markets that have experienced the second wave of COVID-19 contagion, namely the United States (US), Australia, China, Hong Kong and South Korea. The period of investigation in this study ranges from January 24 to August 28, 2020 to cover the first two COVID-19 waves in selected markets. The study estimates the research model by employing the ordinary least square method with fixed effects to control for the heterogeneity that may confound the empirical outcomes.FindingsThe analysis reveals that firms with larger size and more cash reserves before the COVID-19 outbreak have better stock performance under the first wave; however, these advantages impede stock resilience during the second wave. Corporate governance practices significantly influence stock returns only in the first wave as their effects fade when the second wave emerges. The results also suggest that in economies with greater power distance, although stock price depreciation was milder in the first wave, it is more intense when new cases again surge after the first wave was contained.Practical implicationsThis paper provides practical implications for corporate managers, policymakers and governments concerning crisis management strategies for COVID-19 and future pandemics.Originality/valueThis study is the first to evaluate built-in corporate immunity before the COVID-19 shock under successive contagious waves. Besides, this study accentuates the importance of cultural understanding in weathering the ongoing pandemic across different markets.

A New World Economic order formation

2021 ◽  
pp. 932-950
Author(s):  
Vladislav Vyacheslavovich Emelyanov
Keyword(s):  
Oil And Gas ◽  
World Order ◽  
The United States ◽  
New Order ◽  
The West ◽  
Wide Range ◽  
The World ◽  
The Usa ◽  
World Economic Order ◽  
The Impact

Every few decades, the world order changes due to various geopolitical, economic and other circumstances. For example, as a result of globalization, the world order has undergone significant changes in the last forty years. Globalization has led to the destruction of the postwar world order, as well as to world leadership by the United States and the West. However, in recent decades, as a result of globalization, the U.S. and the West began to cede their leadership to developing countries, so there is now a change in the economic structure of relations in the world system. Today the center of economic growth is in the East, namely in Asia. There are no new superpowers in the world at the moment, but the unipolar world will cease to exist due to the weakening of the U. S. leadership, which will lead to a change in the world order. A new leader, which may replace the U. S., will not have as wide range of advantages as the USA has. Most likely, the essence of the new order will be to unite the largest countries and alliances into blocks, for example, the USA together with the Trans-Pacific Partnership, the EU, etc. The article outlines forecasts of GDP growth rates as well as the global energy outlook; analyzes the LNG market as well as the impact of the pandemic on the global oil and gas market; and lists the characteristics of U. S. geopolitics.

scholarly journals The Impact of Investor Sentiment on Return of Different Industries in Pakistan

2017 ◽  
pp. 1-23
Author(s):  
Sumayya Chughtai Et al.,
Keyword(s):  
Stock Returns ◽  
Principle Component Analysis ◽  
Negative Relationship ◽  
Investor Sentiment ◽  
Differential Impact ◽  
Future Period ◽  
Market Sentiment ◽  
Available Information ◽  
The Impact ◽  
The Relationship

We classify stocks in different industries to measure industrial sentiment based on principle component analysis in order to examine whether investor sentiment exerts a differential impact on stock returns across different industries. After having constructed industry-level sentiment indices we construct a composite investor sentiment index. Our results suggest that investor sentiment negatively affects current as well as future stock returns in Pakistan over the examined period. However, we find that the influence of investor sentiment varies substantially across different industries. We also find that the market sentiment index has a negative relationship with both current and future stock returns. We also show that the direction of the relationship between return and sentiment remains same for the current and future period. This indicates that investors overreact to the available information and mispricing exists for a prolonged time. Our results confirm that sentiment driven mispricing persists for upcoming time and stock markets are not fully efficient to adjust instantaneously.

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