Analysis of the Influences of Covid-19 on the UK Financial Market from a Time Series Perspective

Abstract

The outbreak of the Covid-19 began on December 28, 2019 and has continued to this day. The outbreak of the Covid-19 has caused varying degrees of impact on the financial markets of various countries, causing fluctuations in the stock markets of various countries to varying degrees. This article selects FTSE 100, UK daily new and Global daily new (except UK) from January 24, 2020, and uses ARMA-GARCH model and VAR model to model and analyses the data and to study how Covid-19 is affecting the UK stock market. At the same time, this article will also draw the conclusion that Covid-19 will have a greater impact on the UK stock market in the short term, but then as consumers gradually accept the fact that Covid-19 will coexist with the stock market for a long time, Covid-19 will have a greater impact on the UK stock market. The long-term impact on the UK stock market will level off. In addition, this article will also give some suggestions to investors, so that investors can better avoid the risks brought by Covid-19. For example, investors can choose the right time to invest according to our image.