article · International Journal of Emerging Markets
An investigation into 69 firms across 11 sectors listed on the Bucharest Stock Exchange between 2018 and 2022 highlights how major external disruptions influence equity markets. Market performance shifted significantly between the pre-crisis period and the COVID-19 pandemic. Although the initial outbreak caused an adverse and notable contraction in firm performance, the stock market subsequently rebounded to surpass pre-pandemic capitalisation levels as well as regional and global indices. Sectoral classifications also played a major role in shaping these market outcomes, revealing distinct variations in resilience across industries. In particular, the communication services sector demonstrated accelerated growth during the crisis. These findings illustrate the divergent paths individual sectors take during widespread economic disruptions and how overall markets can recover following early shocks.
Understanding how financial markets and specific industries respond during major crises helps explain how economic resilience and recovery occur. By identifying that sectors such as communication services can accelerate while the wider stock market rebounds past pre-crisis levels, these findings provide non-specialists with clearer insights into the uneven impacts of macroeconomic shocks across different business sectors.
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Purpose Stock market performance is paramount to every country, as it signifies economic growth, business performance, wealth maximization, savings deployment and consumer confidence. This study investigates the disparities in the market performance of listed firms in Romania. This study also examines whether the COVID-19 crisis affected market performance. Design/methodology/approach The data were collected from 69 firms listed on the Bucharest Stock Exchange (BSE) from 2018 to 2022, belonging to 11 sectors. This study used several methods to achieve its objectives. Difference tests were considered to analyze the performance of Romanian companies before and during the COVID-19 crisis, as well as across sectors. Regression analysis was also conducted to estimate the effect of the COVID-19 crisis and classification type on Romanian companies' performance. Additional analyses were performed to verify the findings of the present study. Findings The study’s findings indicate a clear difference in market performance between the pre-crisis and crisis periods. The COVID-19 pandemic had an adverse and significant impact on market performance. However, after the market contraction in the early stage of the COVID-19 pandemic outbreak, the stock market outperformed the pre-pandemic capitalization levels and the regional and global indices evolution. Furthermore, there was a difference in market performance across sectors. In particular, the communication services sector has specifically demonstrated accelerated growth. Originality/value This research examines the variation in the market performance of companies before and during the COVID-19 pandemic and across different sectors. It also provides evidence of the potential impact of COVID-19 on firms' market performance. This research contributes to a better understanding of how sectors perform during times of crisis.
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DOI: 10.1108/ijoem-05-2023-0842
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