Contagious COVID 19: Leading to Hysteria in Indian Stock Marketsand Sectoral Indices Performance
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Abstract
The eruption of the novel corona virus in India has led to the outflow of panic due to high media coverage. This unparalleled broadcast of news has led to swift flow of information to investors and reactions can be assessed with increased volatility in financial markets. EGARCH (1,1) Model is applied to determine the relationship between the market returns of different industries along with the panic generated due to media coverage about the corona virus outbreak. Imposition of mobility control in terms of Lockdown has exerted the significant impact on stock market and sectoral indices returns. And depending on the nature of the business associated, different sectors have performed in a different way to this corona virus outburst. Even if returns are not affected directly then conditional volatility pervasiveness can easily be detected. So, the news burdened with panic and negative sentiment has definitely contributed to a prodigious level of volatility in the sectors professed to be most affected by the corona virus outbreak in India
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