Local and National Covid-19 Cases and Stock Return: Evidence from Regions in Indonesia

Abstract

INTRODUCTIONCoronavirus outbreak has now spread to 221 countries in the world. The total number of positive cases and the total deaths increases every day. So that on March 11, 2020, WHO declared Covid-19 as a pandemic. Until the end of 2020, there were 84 million positive cases and 1.8 million deaths recorded worldwide (Coronavirus Graphs 2021.). In early March, precisely on March 2, 2020, coronavirus' first case was found in Indonesia. Financially the pandemic leads to a negative economy.Investors began to withdraw their money because of what happened in the other ASEAN stock market index country. Indo-nesia's stock market price (IHSG) decreased by 1,712.51 points before getting revived (PT Bursa Efek Indonesia 2020). The difference between national and local cases estimate has potentially generated abnormal returns to the companies' stock. This paper will discuss the effect of national cases and local cases reported on companies' abnormal returns in local areas. Many studies have discussed positive coronavirus cases into abnormal returns in certain countries (Al-