How Different Terrorist Attacks Affect Stock Markets

Faheem Aslam, Hyoung Goo Kang

Research output: Contribution to journalArticlepeer-review

54 Scopus citations


Terrorist attacks adversely affect the Pakistani stock market. However, such effect is short-lived: the market recovers from terrorist shocks in one day. The impact of attack depends on the locations and types of attack. The more severe the attack (i.e. more people killed), the more negative is the KSE-100 index return. Most interestingly, stock market contains information about future attacks. In sum, different tactics of terrorists have varied effects on financial markets, which in turn can predict terrorist attacks.

Original languageEnglish
Pages (from-to)634-648
Number of pages15
JournalDefence and Peace Economics
Issue number6
StatePublished - 2015 Nov 2


  • Drone attacks
  • Event study
  • Geopolitical risk
  • Karachi stock exchange (KSE)
  • Stock returns
  • Terrorist’s attack


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