Abstract

Along with the growing trade conflict between China and the America, many Chinese industries have been affected by it. The impact on the Chinese chip industry is particularly dramatic. Depending on some studies, due to the deteriorating relationship between these two big countries, the United States has implemented many restrictive policies on Chinese chip industry, such as limiting technical support from U.S. companies to Chinese companies and requiring licenses for related companies to cooperate with Chinese companies. This series of initiatives on the Chinese chip industry is a huge impact, but also greatly influence the trend of the Chinese chip stock market. This study uses the ARIMA model to estimates the chip index without U.S.-China trade conflict The model based on weekly data finds that in the ultra-short term, the influence of the trade war on the chip index is relatively small. The model based on monthly data finds that in the short term (4 months) the average effect of this conflict on the chip index is about -3.29%.

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