{"title":"How do commodity futures respond to Ukraine–Russia, Taiwan Strait and Hamas–Israel crises? – An analysis using event study approach","authors":"António Miguel Martins","doi":"10.1108/sef-03-2024-0140","DOIUrl":null,"url":null,"abstract":"Purpose\nThe purpose of this study investigates the short-term market reaction of three commodity futures indices for four recent events of high geopolitical risk: the Ukraine–Russia war, the Taiwan Strait crisis and the Hamas terrorist attack on Israel.\n\nDesign/methodology/approach\nThe author examines three commodity futures indices at and around the beginning of four recent events of high geopolitical risk using an event study methodology.\n\nFindings\nThe results show a positive abnormal return for the commodity futures indices for three of the four recent events considered in the analysis. The exception in terms of abnormal returns observed is the visit of US Speaker of the House Nancy Pelosi to Taiwan on August 2, 2022, which resulted in statistically significant negative abnormal returns in the commodity futures around the visit. The other three geopolitical events, by causing an increase of uncertainty level and supply-side constraints, led to a rise in the price of most commodity futures. This allowed commodity-exporting countries to achieve positive and statistically significant abnormal returns. Policy implications of our findings are discussed.\n\nOriginality/value\nThe effect of high geopolitical risk events on commodity futures indices has been relatively little examined in the financial theory. This study intends to fill this gap in the literature.\n","PeriodicalId":2,"journal":{"name":"ACS Applied Bio Materials","volume":"45 1","pages":""},"PeriodicalIF":4.6000,"publicationDate":"2024-08-13","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"0","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"ACS Applied Bio Materials","FirstCategoryId":"1085","ListUrlMain":"https://doi.org/10.1108/sef-03-2024-0140","RegionNum":0,"RegionCategory":null,"ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q2","JCRName":"MATERIALS SCIENCE, BIOMATERIALS","Score":null,"Total":0}
引用次数: 0
Abstract
Purpose
The purpose of this study investigates the short-term market reaction of three commodity futures indices for four recent events of high geopolitical risk: the Ukraine–Russia war, the Taiwan Strait crisis and the Hamas terrorist attack on Israel.
Design/methodology/approach
The author examines three commodity futures indices at and around the beginning of four recent events of high geopolitical risk using an event study methodology.
Findings
The results show a positive abnormal return for the commodity futures indices for three of the four recent events considered in the analysis. The exception in terms of abnormal returns observed is the visit of US Speaker of the House Nancy Pelosi to Taiwan on August 2, 2022, which resulted in statistically significant negative abnormal returns in the commodity futures around the visit. The other three geopolitical events, by causing an increase of uncertainty level and supply-side constraints, led to a rise in the price of most commodity futures. This allowed commodity-exporting countries to achieve positive and statistically significant abnormal returns. Policy implications of our findings are discussed.
Originality/value
The effect of high geopolitical risk events on commodity futures indices has been relatively little examined in the financial theory. This study intends to fill this gap in the literature.
期刊介绍:
ACS Applied Bio Materials is an interdisciplinary journal publishing original research covering all aspects of biomaterials and biointerfaces including and beyond the traditional biosensing, biomedical and therapeutic applications.
The journal is devoted to reports of new and original experimental and theoretical research of an applied nature that integrates knowledge in the areas of materials, engineering, physics, bioscience, and chemistry into important bio applications. The journal is specifically interested in work that addresses the relationship between structure and function and assesses the stability and degradation of materials under relevant environmental and biological conditions.