Stock Markets under the Global Pandemic: Evidence from Tunisia during the Early Stage of the COVID-19 Pandemic

The purpose of this study is to investigate the impact of COVID-19 on the performance of stock returns for all companies listed on the Tunis Stock Exchange. More specifically, we analyse the impact of various factors on stock market outcomes. These factors are (1) the daily growth in confirmed cases (DCG), (2) the daily growth in COVID-19 deaths (DDG), and (3) the daily growth in recovered cases (DReC). Our findings show that DCG had a negative impact on stock returns, while DDG increased the performance of stock returns. Finally, DReC had a positive relationship with returns, but this was not significant. The results also highlight how firm capitalization and the daily returns for Brent Crude had a negative impact on stock returns, while the FX rate had a positive impact. On conducting a sectorial analysis, we also found that the consumer cyclical sector has suffered hardships from COVID-19, while stocks returns from the service sector showed the best performance.