Dynamic changes in US Financial Markets under the COVID-19 Pandemic

Covid-19 disrupted people’s lives and the world’s economic activities in major ways. The pandemic affected, businesses, companies, investors stock market. This paper aims to how normalized affect United States market by analyzing three US markets: S&P500, NASDAQ, DJIA. aim was examine effect on market’s return volatility. To analyze impact of pandemic, vector autoregression models (VAR) as well ARMA-GARCH-X model were used. Impulse response function graph from VAR revealed that did increase or decrease returns either indices. However, fluctuations shown be higher during early period but faded with time. however reported only influenced volatility S&P500 while other two markets not affected. Conclusion drawn study is days its influence tapered down due normalization mind investors. Government responses introduction vaccines could also serve raise investor’s confidence thus reducing