The effect of the Russian-Ukrainian Conflict on the main frontier Markets: An Event Study Approach

It is generally acknowledged that geopolitical events have a substantial effect on the different aspects of the global economy, especially financial markets. Considering the extent of the impacts caused by the Russo-Ukrainian conflict in 2022 and the lack of studies on its effect on frontier markets, our research aims to study the effect of the outbreak of the conflict between Russia and Ukraine on frontier stock markets. Our study employs an event study approach on the daily returns of the benchmarks of the main frontier markets, namely Vietnam, Morocco, Island, Kazakhstan, and Romania. The results of our research show that the main studied frontier markets reacted negatively to the Russo-Ukrainian conflict, and the shock did not subside even during later periods.