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      COVID-19: Media coverage and financial markets behavior—A sectoral inquiry

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      Journal of Behavioral and Experimental Finance
      Elsevier B.V.

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          Abstract

          We analyze the relationship between sentiment generated by coronavirus-related news with volatility of equity markets. The ongoing coronavirus outbreak (COVID-19) resulted in unprecedented news coverage and outpouring of opinions in this age of swift propagation of information. Ensuing uncertainty in financial markets leads to heightened volatility in prices. We find that overwhelming panic generated by the news outlets are associated with increasing volatility in the equity markets. Our results for individual economic sectors demonstrate that panic-laden news contributed to a greater extent to volatility in the sectors perceived to be most affected by coronavirus outbreak

          Highlights

          • COVID-19 pandemic led to media panic sentiment shock.

          • Media frenzy contributes to investment climate uncertainty.

          • Panic caused higher market volatility.

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          Most cited references28

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          Conditional Heteroskedasticity in Asset Returns: A New Approach

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            Financial markets under the global pandemic of COVID-19

            Highlights • The COVID-19 pandemic has significant impacts on global financial markets. • Substantial increases of volatility are found in global markets due to the outbreak. • Global stock markets linkages display clear different patterns before and after the pandemic announcement. • Policy responses may create further uncertainties in the global financial markets.
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              Giving Content to Investor Sentiment: The Role of Media in the Stock Market

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                Author and article information

                Contributors
                Journal
                J Behav Exp Finance
                J Behav Exp Finance
                Journal of Behavioral and Experimental Finance
                Elsevier B.V.
                2214-6350
                2214-6369
                15 May 2020
                15 May 2020
                : 100343
                Affiliations
                [1]Suleman Dawood School of Business, Lahore University of Management Sciences (LUMS), Lahore, Pakistan
                Author notes
                [* ]Corresponding author. aun.raza@ 123456lums.edu.pk
                Article
                S2214-6350(20)30138-6 100343
                10.1016/j.jbef.2020.100343
                7227534
                32427152
                3aee2ba5-4df8-4b97-9a9e-705b6066538e
                © 2020 Elsevier B.V. All rights reserved.

                Since January 2020 Elsevier has created a COVID-19 resource centre with free information in English and Mandarin on the novel coronavirus COVID-19. The COVID-19 resource centre is hosted on Elsevier Connect, the company's public news and information website. Elsevier hereby grants permission to make all its COVID-19-related research that is available on the COVID-19 resource centre - including this research content - immediately available in PubMed Central and other publicly funded repositories, such as the WHO COVID database with rights for unrestricted research re-use and analyses in any form or by any means with acknowledgement of the original source. These permissions are granted for free by Elsevier for as long as the COVID-19 resource centre remains active.

                History
                : 7 May 2020
                : 14 May 2020
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