The impact of the U.S. and the Japanese equity markets on the emerging Asia-Pacific equity markets

Baekin Cha, Stephen Y L Cheung*

*Corresponding author for this work

Research output: Contribution to journalJournal articlepeer-review

24 Citations (Scopus)

Abstract

Using a tri-variate vector autoregression model, we study the relationships between the four Asian emerging equity markets: Hong Kong, Korea, Singapore and Taiwan, and the two largest equity markets in the world: U.S. and Japan. We find that while most of the unexpected variations in stock returns in these Asian emerging markets is explained by domestic own shocks, the impacts from the U.S. and Japan are larger in Hong Kong and Singapore than in Korea and Taiwan. This foreign effect is pronounced after the Crash of the October 1987, especially in Singapore.

Original languageEnglish
Pages (from-to)191-209
Number of pages19
JournalAsia-Pacific Financial Markets
Volume5
Issue number3
DOIs
Publication statusPublished - 1998

Scopus Subject Areas

  • Finance

User-Defined Keywords

  • Asia-Pacific equity markets
  • Vector Autoregressive Model

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