Analysis of 2020 Global Stock Market Crash

Abstract

We applied the Log-periodic power law singularity (LPPLS) methodology to analyze the performances of the 10 major global stock market indexes from both developed and emergent stock markets in the 2020 global stock market. The results show that the crashes for the 7 indexes: SP500, DJIA, NASDAQ, DAX, CSI300, BSESN, and BOVESPA, are endogenous due to the increasingly systemic instability of the financial markets, while the crashes in the three indexes: FTSE, NIKKEI, and HSI, are exogenous caused by external shocks.

Keywords: 2020 stock market crash, Log-periodic power law singularity (LPPLS), Financial bubble, Market crash

JEL Classification: G01, C02, C53