What Is the Impact of the Russian War in the Ukraine on Global Stock Market Sectors In 2022?

Steffen Robus; Walter Virág; Zsolt Kőmüves

doi:10.33565/MKSV.2024.01.03

Steffen Robus Hungarian University of Agriculture and Life Sciences, Doctoral School in Management and Organizational Sciences https://orcid.org/0009-0001-9784-8432
Walter Virág Hungarian University of Agriculture and Life Sciences Institute of Agricultural and Food Economics https://orcid.org/0000-0002-8728-4901
Zsolt Kőmüves Hungarian University of Agriculture and Life Sciences Institute of Agricultural and Food Economics https://orcid.org/0000-0002-7966-3346

DOI: https://doi.org/10.33565/MKSV.2024.01.03

Keywords: Russia-Ukraine conflict, Market efficiency, Stock market, Event study

Abstract

The Russian Federation's war of aggression against Ukraine has prompted reallocations in equity investments around the world. Overall portfolios were adjusted globally. There were many losses but also gains. This article analyzes the impact of the Russian war in Ukraine on global stock market sectors. With this, we would like to answer the following questions: what impact did the Russian war have on the biggest companies worldwide, and what expectations do investors have about the development of the respective business models operating in different stock market sectors. In addition to analyzing the major stock market indices in other studies, we focus on the impact on various market sectors. This is important as sector indices are used to apply a specific stock strategy and to hedge the risk of individual stocks belonging to a particular sector. By doing an event study, we analyzed abnormal returns and cumulative abnormal returns of the 11 different MSCI World sector indices. We have evidence that on 24^th February, the beginning of the Russian attack, almost all sectors had negative abnormal returns. The development would be more differentiated from the stock market sectors in the following days. Our analysis of cumulative abnormal returns shows to what extent the abnormal returns are sustainable.

Author Biographies

Steffen Robus, Hungarian University of Agriculture and Life Sciences, Doctoral School in Management and Organizational Sciences

PhD Student

Walter Virág, Hungarian University of Agriculture and Life Sciences Institute of Agricultural and Food Economics

Associate Professor

Zsolt Kőmüves, Hungarian University of Agriculture and Life Sciences Institute of Agricultural and Food Economics

Associate Professor

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