Abstract:

Covid-19, which has won the status of an international health threat at the end of January 2020, has created very fast and deep socio-economic effects globally. Covid-19, in March of 2020, led to huge losses in the world’s stock markets. The aim of this study is to identify and compare the effects of the Covid-19 pandemic on Islamic and traditional exchanges. For this purpose, the Islamic and traditional index daily return data of nine different regions and countries were analyzed by the event study method. This study was selected as the forecast window (-6, -200) and used the date of January 30, 2020 when the World Health Organization (WHO) declared Covid-19 a global health emergency as the event day. In the 30-day long-term window of the day after the incident, the cumulative abnormal return of all Islamic and traditional indicators was found negative and statistically meaningful. Islamic and traditional indicators have responded in a similar way to the global health crisis by serious loss of value. However, the value loss of traditional indices, except in the United Kingdom, has been greater than Islamic indices in all indices. The average value loss for nine indicators is 28.65% for Islamic indicators, while this value is 35.45% for traditional indicators.

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