When politics turn volatile: Equity market responses to the Trump–Zelensky confrontation

Karoubi, Bruno and Seeballack, Parvesh (2026) When politics turn volatile: Equity market responses to the Trump–Zelensky confrontation. Economics Letters, 263. ISSN 0165-1765

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Abstract

This study analyzes how the 28 February 2025 Trump–Zelensky meeting affected European and U.S. stock markets. Event-day abnormal returns were modest and mostly negative across continental Europe, particularly in countries near Ukraine or reliant on Russian energy, while distant market such as the UK showed slight gains. Cumulative abnormal returns reflected delayed market adjustments to unexpected meeting developments, later reversing after Ukraine’s allies coordinated at the 2 March London summit. Regression analysis confirms geopolitical risk and negative media coverage reduce returns, with heightened effects during uncertainty. Media sentiment amplifies market reactions to geopolitical events.

Item Type:	Article
Additional Information and Comments:	© 2026 The Authors. Published by Elsevier B.V. This is an open access article under the CC BY license (http://creativecommons.org/licenses/by/4.0/
Faculty / Department:	Faculty of Business, Law and Criminology > Liverpool Hope Business School
SWORD Depositor:	RISE Symplectic
Depositing User:	RISE Symplectic
Date Deposited:	13 Apr 2026 08:58
Last Modified:	13 Apr 2026 08:58
URI:	https://hira.hope.ac.uk/id/eprint/4883

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