Impact of the war in Ukraine on the global stock market

Abstract

This article focuses on and analyzes how the full-scale invasion of Russia on the territory of Ukraine on February 24, 2022, affected and continues to affect the part of the global capital market where securities are issued, bought and sold, namely the stock market. It is determined what any price changes are based on here; how stock markets can reflect the expectations of a certain group of people, in this case investors around the world, during a period of war; sanctions and pressure on the stock market. Also, the average response of twenty companies included in the Top-500 best stocks in the Center for Research in Security Prices database to percentage changes in the weighted commodity price index was evaluated. That is, we estimated how much a 1% change in the commodity price index would change the share prices of each of the 20 companies. It is determined separately how the military conflict affected the securities of American companies operating in various industries; for whom the war helped to increase capitalization, and for whom it contributed to the deterioration of the general financial condition. How the ranking of the best-performing S&P 500 stocks has changed in 2022. Why on September 13, the share prices of many global companies decreased, and the three main stock indexes (Dow Jones Industrial Average, Nasdaq Composite and S&P 500) had their worst day since June 2020. Forecast of their further changes. Separately, in addition to the American one, the changes that took place in the stock markets of Eastern countries, using the example of China, Thailand, India and Indonesia, are highlighted. Expected changes in the Russian stock market and the possibility of its complete disappearance due to sanctions imposed by various countries of the world are described. The situation on the market of Ukraine itself and the options of what exactly to invest in for domestic investors during the period of active military operations were considered. In addition to all this, the solution to problems related to the volatility of the stock market is highlighted. Thus, the question of the influence of the war between Ukraine and Russia on the state of the world stock markets, in modern realities, is paid a lot of attention not only by Ukrainian scientists, but also by foreign ones. This is not surprising, since it is impossible to ignore that the recent events have caused a chain effect, affecting firstly the prices of goods, the volume of exports, and subsequently the capitalization and growth or decline of the prices of securities of companies around the world.