US-China trade war and its impacts on both us and China stock markets and the whole economy

Abstract

The purpose of this study is to find out whether US-China trade war has significant impacts on the stock markets and the stock prices. Due to the fact that US initiated the trade war, it is widely recognized that US probably benefits from the trade war. It is significant and indispensable to quantify the consequence of US-China trade war to help people know the essence of it, and how it impacts different industries. Using 400 trading days’ data for each observation, the study mainly uses t-test to find out whether there are significant changes between the stock indexes or stock prices before and after the announcement of US-China trade war. The results indicate that both US and China stock markets are impacted by the announcement of the trade war which is also the influence of tariff changes. However, US stock market is positively impacted, and China stock market is negatively impacted. Besides, for some typical companies, most stock prices of them are impacted by the trade war, only DTE is not impacted by the trade war. In conclusion, US-China trade war brings lots of impacts on both countries.