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From Shanghai to Sydney: Chinese stock market influences on Australia

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  • Burdekin, Richard C. K
  • Tao, Ran

Abstract

We examine whether China's growing importance to Australia as both a trade partner and engine of growth has been accompanied by financial market interdependence. We consider effects on the overall Australian market as well as the iron ore sector, which has been accounting for over half of Australia's exports to China in the years since the global financial crisis. Markov-switching analysis yields evidence of the Shanghai Composite being connected not only with the Australian iron ore sector but also the broad market Australian All Ordinaries index. These ties are found to be significant only during low volatility periods, however.

Suggested Citation

  • Burdekin, Richard C. K & Tao, Ran, 2021. "From Shanghai to Sydney: Chinese stock market influences on Australia," Finance Research Letters, Elsevier, vol. 38(C).
    • Handle: RePEc:eee:finlet:v:38:y:2021:i:c:s1544612319301151
    DOI: 10.1016/j.frl.2020.101502
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    References listed on IDEAS

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    Cited by:

    1. Heß, Alexander & Hindermann, Christoph Michael, 2022. "The BRI: Trade integration and stock market synchronization. A review of empirical findings," Discourses in Social Market Economy 2022-3, OrdnungsPolitisches Portal (OPO).
    2. Burdekin, Richard C.K. & Reckers, Dawson & Tao, Ran, 2022. "Quantifying China’s financial reach up through the pandemic: The African experience," The North American Journal of Economics and Finance, Elsevier, vol. 63(C).
    3. Singh, Amit & Jenamani, Mamata & Thakkar, Jitesh J. & Rana, Nripendra P., 2021. "Propagation of online consumer perceived negativity: Quantifying the effect of supply chain underperformance on passenger car sales," Journal of Business Research, Elsevier, vol. 132(C), pages 102-114.

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