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Impact Of Geopolitical Risk And Crude Oil Prices On Stock Return

Author

Listed:
  • Chinmaya Behera

    (Goa Institute of Management, India)

  • Biswashree Tanaya Priyadarsini

    (BITS Pilani, India)

  • Debasis Patnaik

    (BITS Pilani, India)

Abstract

This study examines the impact of oil price and geopolitical risk (GPR) on sectoral stock returns in Australia, Japan, the USA, and India. We find that oil price positively affects pharma and commodity stocks, while GPR benefits commodity stocks, excluding the banking sector in Australia. Further, GPR negatively impacts banking stocks due to increased uncertainty and risk aversion only in the case of the USA. Similarly, GPR adversely affects banking stocks in India that leads capital outflows and economic instability, while oil prices positively influence pharma and commodity stocks.

Suggested Citation

  • Chinmaya Behera & Biswashree Tanaya Priyadarsini & Debasis Patnaik, 2024. "Impact Of Geopolitical Risk And Crude Oil Prices On Stock Return," Bulletin of Monetary Economics and Banking, Bank Indonesia, vol. 27(Spesial I), pages 45-58, Februari.
    • Handle: RePEc:idn:journl:v:27:y:2024:i:sid:p:45-58
    DOI: https://doi.org/10.59091/2460-9196.2158
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    More about this item

    Keywords

    Stock returns; Geopolitical risk; Crude oil;
    All these keywords.

    JEL classification:

    • E30 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - General (includes Measurement and Data)
    • G10 - Financial Economics - - General Financial Markets - - - General (includes Measurement and Data)
    • G12 - Financial Economics - - General Financial Markets - - - Asset Pricing; Trading Volume; Bond Interest Rates

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