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Journal article
Evidence of Energy-Related Uncertainties and Changes in Oil Prices on U.S. Sectoral Stock Markets
Mathematics, v 13(11), 1823
29 May 2025
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Abstract
This study examines the relationship between stock prices, energy prices, and climate policy uncertainty using 11 sectoral stocks in the U.S. market. The evidence confirms that rising prices of energy commodities positively affect not only the energy and oil sector stocks but also create spillover effects across other sectors. Notably, all sectoral stocks, except Real Estate sector, show resilience to increases in crude oil and gasoline, suggesting potential hedging benefits. In addition, the findings reveal that sectoral stock returns are generally negatively affected by several types of uncertainty, including climate policy uncertainty, economic policy uncertainty, oil price uncertainty, as well as energy and environmental regulation-induced equity market volatility and the energy uncertainty index. These adverse effects are present across sectors, with few exceptions. The evidence reveals that the feedback effect between changes in climate policy uncertainty and changes in oil prices has an adverse impact on stock returns. Omitting these uncertainty factors from analyses could lead to biased estimates in the relationship between stock prices and energy prices.
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Details
- Title
- Evidence of Energy-Related Uncertainties and Changes in Oil Prices on U.S. Sectoral Stock Markets
- Creators
- Fu-Lai Lin - Dayeh UniversityThomas Chi-Nan Chiang (Corresponding Author) - Drexel University, FinanceYu-Fen Chen - Dayeh University
- Publication Details
- Mathematics, v 13(11), 1823
- Publisher
- MDPI
- Number of pages
- 26
- Grant note
- National Science and Technology Council (Taiwan)
This research was supported by the National Science and Technology Council (Taiwan) under Grant Number NSTC113-2410-H-212-002.
- Resource Type
- Journal article
- Language
- English
- Academic Unit
- Finance
- Web of Science ID
- WOS:001506036900001
- Scopus ID
- 2-s2.0-105007820661
- Other Identifier
- 991022053432504721
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- Collaboration types
- Domestic collaboration
- International collaboration
- Web of Science research areas
- Mathematics