• Medientyp: Bericht; E-Book
  • Titel: Ratings matter: Announcements in times of crisis and the dynamics of stock markets
  • Beteiligte: Rosati, Nicoletta [Verfasser:in]; Bellia, Mario [Verfasser:in]; Matos, Pedro Verga [Verfasser:in]; Oliveira, Vasco [Verfasser:in]
  • Erschienen: Luxembourg: Publications Office of the European Union, 2019
  • Sprache: Englisch
  • DOI: https://doi.org/10.2760/605154
  • ISBN: 978-92-76-02048-6
  • Schlagwörter: G24 ; C58 ; G15 ; generalized ordered probit models ; G01 ; C25 ; Markov chains ; E44 ; Credit ratings ; Europe ; financial crisis
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  • Beschreibung: In this paper we propose a novel approach in analysing the impact of changes in sovereign credit ratings on stock markets. We study the evolution of a segmented form of the stock market index for several crisis-hit countries, including both European and Asian markets. Such evolution is modelled by a homogeneous Markov chain, where the transition probabilities from one starting level of the index to a new (lower or higher) level in the next period depend on some explanatory variables, namely the country's rating, GDP and interest rate, through a generalised ordered probit model. The credit ratings turn out to be determinant in the dynamics of the stock markets for all three European countries considered - Portugal, Spain and Greece, while not all considered Asian countries show evidence of correlation of market indices with the ratings.
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