The Effects of COVID-19 Spread on the Egyptian Exchange Sectors: Winners and Losers across Time

Abstract

This paper attempts to investigate the effects of Coronavirus spread on stock markets using panel data analysis, on daily basis over the period from March 1, 2020 until September 30, 2020. Coronavirus spread has been measured by daily cases and daily deaths per million of population, while stock return is measured by Δ in sectoral indices. This has been conducted after dividing the research period into 6 months from March to September and has been applied on 17 sectors in the Egyptian Exchange.

Using panel data analysis, results indicate significant negative industry effects for each of banking sector (BANK), Food, Beverages and Tobacco sector (FOBT) and Health Care & Pharmaceuticals sector (HLTH). Besides, findings show significant positive industry effects for each of Contracting & Construction Engineering sector (COCE), Energy & Support Services sector (ENGY), IT, Media & Communication Services sector (IMCS), Shipping & Transportation Services sector (SHTS) and Trade & Distributors sector (TRDB).

The robustness check supports the significant negative industry effects for each of Food, Beverages and Tobacco (FOBT) and Health Care & Pharmaceuticals (HLTH) (as losers) and the significant positive industry effects for each of Energy & Support Services (ENGY), Shipping & Transportation Services (SHTS) and Trade & Distributors (TRDB) (as winners).