IDEAS home Printed from https://ideas.repec.org/a/bla/intfin/v28y2025i3p209-219.html

Global Market Reactions to the China–US 2018–2019 Trade War: Evidence From a Chinese Media Sentiment Index

Author

Listed:
  • Leonardo Gambacorta
  • Chao He
  • Fan Dora Xia

Abstract

We analyse the effects of the trade war between China and the United States in 2018–2019 using a Trade Sentiment Index (TSI) based on artificial intelligence–powered big data textual analysis that assesses the positive or negative tone of the Chinese media. Our results show that in this trade war, no equity market has gained. We find the TSI improves upon traditional keyword‐counting methods both methodologically and in explanatory power. The TSI contributes around 10% of model capacity to explain the stock price variability of 60 equity markets in countries that are more exposed to the China–US value chain. Most of the contribution is given by the tone extracted from social media (9%), while that obtained from traditional media explains only a modest part of stock price variability (1%).

Suggested Citation

  • Leonardo Gambacorta & Chao He & Fan Dora Xia, 2025. "Global Market Reactions to the China–US 2018–2019 Trade War: Evidence From a Chinese Media Sentiment Index," International Finance, Wiley Blackwell, vol. 28(3), pages 209-219, December.
    • Handle: RePEc:bla:intfin:v:28:y:2025:i:3:p:209-219
    DOI: 10.1111/infi.70006
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/infi.70006
    Download Restriction: no
    File URL: https://libkey.io/10.1111/infi.70006?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:intfin:v:28:y:2025:i:3:p:209-219. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www.blackwellpublishing.com/journal.asp?ref=1367-0271 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.