Geopolitical Uncertainty and Stock Market Reactions: Evidence from Developed Markets

DOI

10.2991/978-94-6239-701-9_13How to use a DOI?

Keywords

Geopolitical Risk; G7 Equity Markets; Event Study; Abnormal Returns; Market Resilience; Exogenous Shocks

Abstract

This study employs an event study methodology to compare the impacts of two major geopolitical shocks on G7 equity markets, revealing pronounced regional heterogeneity. While most G7 economies experienced significant negative abnormal returns (AR) on the event dates, the market reaction was substantially more volatile during the first shock than the second, suggesting a transition from immediate trauma to a more delayed response. Distinct geographical patterns emerged: European G7 members consistently recorded positive cumulative abnormal returns (CARs), whereas North American markets (Canada and the United States) demonstrated negative cumulative performance. Notably, Japan exhibited divergent return patterns across the two events. These findings offer critical insights into market efficiency, risk transmission, and asset price resilience amid heightened global uncertainty.

Copyright

© 2026 The Author(s)

Open Access

Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

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TY  - CONF
AU  - Zhiyan Jin
PY  - 2026
DA  - 2026/07/30
TI  - Geopolitical Uncertainty and Stock Market Reactions: Evidence from Developed Markets
BT  - Proceedings of the 2026 11th International Conference on Social Sciences and Economic Development (ICSSED 2026)
PB  - Atlantis Press
SP  - 119
EP  - 128
SN  - 2352-5428
UR  - https://doi.org/10.2991/978-94-6239-701-9_13
DO  - 10.2991/978-94-6239-701-9_13
ID  - Jin2026
ER  -