The Empirical Study On The Impact Of Air Pollution On Stock Market

In recent decades,the environmental problems become more and more serious.At the same time,it will cause damage to the physical and mental health of the people,but also have an important impact on all aspects of economy and society.It is well known that serious air pollution will affect the transportation of enterprises,outdoor operations,labor costs,but also affect the physiological and psychological state of investors,which will eventually affect the stock market.Based on this,this paper attempts to explore the characteristics and transmission mechanism of air pollution on China’s stock market,and to verify the influence of this objective factor on the asymmetry of stock return volatility.On the basis of combing the relevant literature at home and abroad,this paper analyzes the characteristics and transmission mechanism of the influence of air pollution on the stock market from the theoretical point of view.Secondly,the stock market and Shanghai air quality data from 2015 to 2020 are selected to explore the relationship between air pollution and stock market income index.The results show that air pollution has a significant impact on the income level of China’s stock market,and when air pollution occurs,the income level of the stock market has a downward trend.Then based on the snowball number to construct the investor concern index and based on the analyst report to construct the investor expectation index,using the intermediary effect model to test the influence channel of air pollution on the stock market.The results show that in the process of the influence of air pollution on the stock market,there are channels of investor concern and investor sentiment.Finally,using generalized auto-regressive co-variance model and rolling regression model,this paper verifies the asymmetry of income fluctuation in China’s stock market,and explores whether air pollution has an impact on the asymmetry of stock market volatility.The results show that there is a significant asymmetry of volatility in China’s stock market,which is more affected by the negative impact of stock return.That is,in the case of air pollution,the difference between stock volatility and positive return volatility is higher than that in normal weather.This study fills in the channel of air pollution’s influence on the stock market and the analysis of the characteristics of asymmetric impact on earnings fluctuations,and provides investors with a new,immediate and easy-to-collect reference index,air quality in the process of choosing investment strategies.it also provides detailed suggestions for the government to formulate relevant policies.At the same time,this paper constructs the investor concern index according to the Internet real-time data and the investor expectation index according to the research report,which quantifies the abstract and difficult to measure accurately.The innovation of this method is helpful to get a reliable conclusion when studying the related problems.