BC Ph.D. Cesare Robotti and Ph.D. candidate Anna Krivelyova have authored a provocative paper, "Playing the Field: Geomagnetic Storms and International Stock Markets," appearing in the Federal Reserve Bank of Atlanta's working paper series as paper 2003-5a. The abstract states 'This paper documents the impact of geomagnetic storms (GMS) on world and country-specific stock market returns. For the world index and for most of the international indices in our sample, we find that the previous week's unusually high levels of geomagnetic activity have a negative, statistically and economically significant impact on today's stock returns. Our results are consistent with psychological theories of "misattribution of mood," since GMS have been found to negatively affect people's judgment and behavior.' Robotti, a 2002 graduate, is a member of the Financial Team of research economists at the Bank.
This happens to be highly timely, as one of the largest geomagnetic storms in recent history has been recorded--and in October, rather an interesting month in the equity markets! See the Yahoo News story (Thanks, John Moore).
29 Oct 2003