Empirical study of European financial markets response on COVID-19 pandemic.

Financial markets were the first to react on COVID-19 pandemic and were also very sensitive on following lock-outs, support policies and restrictions. Though equally exposed to the threat and lack of information, different countries reacted to the disease in a different way. In this paper we focus on European financial markets and respective representative indices to analyze their characteristics and study their response to the economic changes that followed the outbreak of the pandemic. We use six European stock market indices (FTSE 100, CAC 40, DAX, IBEX 35, FTSE MIB and STOXX Europe 600) to compare their performance before and after 2020, assess their reaction on COVID-19 and discuss their recovery. Using MLE estimation and BFGS optimization we analyze return distribution and use them as proxy for pandemic impact. [ABSTRACT FROM AUTHOR]