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Effects of foreign disasters on the petroleum industry in Japan: A financial market perspective

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  • Hanabusa, Kunihiro

Abstract

In this paper, we examine how certain foreign disasters—the September 11 terrorist attacks, Iraq War, and Hurricane Katrina—affected the stock prices of the Japanese petroleum industry. Using the market model with and without heteroskedasticity, we analyze and estimate the extent to which these disasters impacted the stock prices from two perspectives: (1) the influence of these disastrous incidents on the entire petroleum industry and (2) the effect on individual firms. The empirical results reveal that an increase in the stock prices of individual firms caused an increase in the stock prices of the entire Japanese petroleum industry after the September 11 terrorist attacks. However, the Iraq War and Hurricane Katrina had both negative and positive influences on the expected profits of individual firms and did not have a significant effect on the stock prices of the Japanese petroleum industry.

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  • Hanabusa, Kunihiro, 2010. "Effects of foreign disasters on the petroleum industry in Japan: A financial market perspective," Energy, Elsevier, vol. 35(12), pages 5455-5463.
    • Handle: RePEc:eee:energy:v:35:y:2010:i:12:p:5455-5463
    DOI: 10.1016/j.energy.2010.06.036
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    2. Ji, Qiang & Guo, Jian-Feng, 2015. "Oil price volatility and oil-related events: An Internet concern study perspective," Applied Energy, Elsevier, vol. 137(C), pages 256-264.
    3. Hanabusa, Kunihiro, 2012. "The effect of 107th OPEC Ordinary Meeting on oil prices and economic performances in Japan," Renewable and Sustainable Energy Reviews, Elsevier, vol. 16(3), pages 1666-1672.
    4. Mirzosaid Sultonov, 2021. "External Shocks and Volatility Overflow among the Exchange Rate of the Yen, Nikkei, TOPIX and Sectoral Stock Indices," JRFM, MDPI, vol. 14(11), pages 1-13, November.
    5. Qiuyun Wang & Lu Liu, 2022. "Pandemic or panic? A firm-level study on the psychological and industrial impacts of COVID-19 on the Chinese stock market," Financial Innovation, Springer;Southwestern University of Finance and Economics, vol. 8(1), pages 1-38, December.
    6. Mirzosaid Sultonov & Shahzadah Nayyar Jehan, 2018. "Dynamic Linkages between Japan’s Foreign Exchange and Stock Markets: Response to the Brexit Referendum and the 2016 U.S. Presidential Election," JRFM, MDPI, vol. 11(3), pages 1-8, June.
    7. Mirzosaid Sultonov, 2020. "The Impacts of International Political and Economic Events on Japanese Financial Markets," IJFS, MDPI, vol. 8(3), pages 1-10, July.

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