Introduction
In recent decades, several pandemics (e.g., H1N1, SARS, and Ebola) have broken out, but none with the far-reaching, global, and colossal impact of COVID-19. It caused shocks to the global economy, and the uncertainty of the capital market has caused fluctuations in investor sentiment and impacted the development of enterprises. There are a total of 7 papers in this in this special issue, focusing on the stock market, financial technology and supply chain etc. under COVID-19.
Yifei Gong, Yanchun Xia, Xuehua Xia, and Yan Wang show that internal control plays an important role in mitigating stock price crash risk caused by management earnings forecasts bias, using a sample of Chinese listed firms over 2012–2018.
Jyh-Horng Lin, Ching-Hui Chang, and Shi Chen develop a contingent claim model of a risk-averse life insurer’s equity with various borrowing-firm credit risk features. However, either the severe novel coronavirus (COVID-19) pandemic or the substantial risk aversion deteriorates policy-holder protection.
Rui Wang, Haomin Wang, and Yi Chen examine bank credit availability in response to the pandemic by testing the firm’s interest expense stickiness. They found that interest expense stickiness was widespread in Chinese listed firms, particularly in state-owned enterprises and large firms, the stronger interest expense stickiness could improve firm’s performance.
Changyuan Xia, Junjie Yang, Na He, and Kam C. Chan examine the impact of a supply chain disruption on stock returns by exploiting the lockdown of Wuhan on January 23, 2020, during the COVID-19 pandemic and the disclosure of public firms’ top five suppliers. It is suggested that firms with major suppliers in Wuhan experience significantly worse cumulative abnormal returns than those whose suppliers are not located in Wuhan.
Yuming Zhang, Chao Xing, and Xiaohan Guo find that in regions with a well-developed fintech and traditional finance environment and in SMEs that utilize more fintech and traditional finance instruments, the pandemic has had less of an impact on the cash shortage. This study indicates that fintech is more effective in reducing the negative impact of the pandemic and helping SMEs recover in the post-pandemic period.
Wei Chen, Qian Zhao, Matthew Quayson, Hongyan Du, and Haomin Wang explore the decentralized, centralized and bargaining models of a supply chain involving an electricity generator and a retailer. A bargaining contract for energy supply chain firms is designed to improve profits on low investment, thereby improving their financial health and competitive advantage.
Viral V. Acharya, V. Ravi Anshuman, and K. Kiran Kumar study the period of the COVID-19 outbreak to assess the impact of foreign institutional investor (FII) flows on asset prices in an emerging market. The study shows the efficacy of stabilization policies, initiated notably by the Federal Reserve, in dampening the relation of foreign fund flows and equity prices in the immediate aftermath of the COVID-19 outbreak.
Implications
Recent research has analyzed the association between COVID-19 and financial market, Dai et al. (Citation2021), Chundakkadan (Citation2021), and Hong, Bian, and Lee (Citation2021), study the effect of COVID-19 on stock market performance and provide important implications for both financial theory and practice. While Salisu and Obiora (Citation2021) focused on the COVID-19 pandemic and the crude oil market risk. As Nigmonov and Shams (Citation2021) highlighted a better understanding of the lending dynamics of a successful marketplace is necessary under the conditions of financial distress. Wang and Liu (Citation2022) emphasized an analysis of the economic and financial impacts of COVID-19 makes for a unique contribution in understanding their intrinsic mechanisms as well as the complex relationship. Most articles in this special issue offer timely empirical findings from the perspective of bank credit, supply chain, Fintech and stock market. With some samples from China and India etc., the special issue is expected to contribute to other emerging markets and countries affected by the epidemic.
Disclosure statement
No potential conflict of interest was reported by the author(s).
References
- Chundakkadan, R. 2021. Light a lamp and look at the stock market. Financial Innovation 7 (19). doi:10.1186/s40854-021-00232-6.
- Dai, P. F., X. Xiong, Z. Liu, T. L. D. Huynh, and J. Sun. 2021. Preventing crash in stock market: The role of economic policy uncertainty during COVID-19. Financial Innovation 7 (1):31. doi:10.1186/s40854-021-00248-y.
- Hong, H., Z. Bian, and C. C. Lee. 2021. COVID-19 and instability of stock market performance: Evidence from the U.S. Financial Innovation 7 (1):12. doi:10.1186/s40854-021-00229-1.
- Nigmonov, A., and S. Shams. 2021. COVID-19 pandemic risk and probability of loan default: Evidence from marketplace lending market. Financial Innovation 7 (1). doi:10.1186/s40854-021-00300-x.
- Salisu, A. A., and K. Obiora. 2021. COVID-19 pandemic and the crude oil market risk: Hedging options with non-energy financial innovations. Financial Innovation 7 (1). doi:10.1186/s40854-021-00253-1.
- Wang, Q., and L. Liu. 2022. Pandemic or panic? A firm-level study on the psychological and industrial impacts of COVID-19 on the Chinese stock market. Financial Innovation 8 (1). doi:10.1186/s40854-022-00335-8.