Stocks Rise While COVID-19 Cases Rise Too

Paola Preliminary research by Yale SOM’s Peter Schott, the Juan Trippe Professor of International Economics, and three co-authors, reveals that unexpected investor behavior is causing the stock market to recover while COVID-19 cases are on the rise.

During the first few weeks of the COVID-19 pandemic, expectedly, stock market prices plunged. But since then they have risen. Research suggests that investors may be responding to whether the latest data on infections suggested that the future outbreak trajectory was worse or better than previously expected rather than the total number of cases.