Factors Influencing Stock Market Volatility in the United States
DOI:
https://doi.org/10.47672/ajsas.1991Keywords:
Stock Market, Volatility, United StatesAbstract
Purpose: The aim of the study was to assess factors influencing stock market volatility in the United States.
Methodology: This study adopted a desk methodology. A desk study research design is commonly known as secondary data collection. This is basically collecting data from existing resources preferably because of its low cost advantage as compared to a field research. Our current study looked into already published studies and reports as the data was easily accessed through online journals and libraries.
Findings: The study suggests that various economic, financial, and geopolitical factors play significant roles. Economic indicators such as GDP growth rates, inflation rates, and unemployment levels have been identified as key determinants of stock market volatility. Additionally, financial factors such as interest rates, exchange rates, and credit conditions also exert substantial influence on market volatility. Moreover, geopolitical events, including political instability, trade tensions, and geopolitical conflicts, can trigger significant fluctuations in stock prices.
Implications to Theory, Practice and Policy: Efficient market hypothesis, behavioral finance and market microstructure theory may be used to anchor future studies on assessing the factors influencing stock market volatility in the United States. The empirical studies have highlighted the importance of developing robust risk management strategies for investors. Policymakers should consider the implications of geopolitical events on stock market volatility when formulating economic policies.
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