A Shot in the Arm: The Effect of COVID-19 Vaccine News on Financial and Commodity Markets

The Financial Review, Forthcoming

70 Pages Posted: 1 Jun 2021 Last revised: 1 May 2023

See all articles by Oleg Kucher

Oleg Kucher

Frostburg State University - Department of Economics

Alexander Kurov

West Virginia University - College of Business & Economics

Marketa Wolfe

Skidmore College - Department of Economics

Date Written: April 13, 2023

Abstract

We analyze the impact of COVID-19 vaccine announcements by leading vaccine companies on the financial and commodity markets from January to December 2020. We show that the vaccine announcements had varied and economically significant impacts on asset prices. The announcements moved interest rates, stock markets in the U.S. and numerous other countries as well as commodities used in transportation and some agricultural commodities. We show that the stock and commodity markets that experienced larger declines at the beginning of the pandemic receive a larger boost from good vaccine news. We also find that the vaccine news affects stock returns through changes in the expectations of the corporate cash flows and the expected equity risk premium.

Keywords: COVID-19 vaccine, stock market, interest rates, commodities, foreign exchange

JEL Classification: F31, G12, G14, G15, I10, Q41

Suggested Citation

Kucher, Oleg and Kurov, Alexander and Wolfe, Marketa, A Shot in the Arm: The Effect of COVID-19 Vaccine News on Financial and Commodity Markets (April 13, 2023). The Financial Review, Forthcoming, Available at SSRN: https://ssrn.com/abstract=3852364 or http://dx.doi.org/10.2139/ssrn.3852364

Oleg Kucher (Contact Author)

Frostburg State University - Department of Economics ( email )

Guild Center 101 Braddock Road
Frostburg, MD 21532-2303
United States

Alexander Kurov

West Virginia University - College of Business & Economics ( email )

P.O. Box 6025
Morgantown, WV 26506
United States

Marketa Wolfe

Skidmore College - Department of Economics ( email )

815 N Broadway
Saratoga Springs, NY 12866
United States
+1-518-580-8374 (Phone)

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