DefinePK

Abstract

The Asian Pacific region is spearheading the post-pandemic economic revival, and\nexploring regional dynamics is becoming increasingly relevant for researchers. In this\nregard, stock markets have always profoundly influenced a country's economic health, and\nits behavior varies significantly globally. This indicates stock markets' contextualized nature\nand response to varying incoming information. Therefore, the study examines the interplay\nof behavioral and developmental factors in selected stock markets from South Asia. This\nstudy draws upon data from 2014 to 2023 and utilizes VAR-based connectedness models to\nanalyze the dynamics of stock market connectedness in the region. This study also considers\nthe influence of pertinent regional climate, security, and economic challenges on stock\nmarket behavior. The findings indicate the presence of moderate spillovers among stock\nmarkets and from economic, environmental, and security information. Further, most of this\nspillover is attributed to the markets in developed nations and the economic news\nsentiments, while climate information's contagion is increasingly becoming relevant. These\nfindings explain the intricate dynamics of these pertinent variables, significantly adding to\nthe understanding of the region.