Research on the Impact of Tariff Incidents on the Stock and Gold Markets: An empirical analysis based on the ARIMA model

The tariff incidents have exerted a profound impact on global financial markets, significantly affecting both the stock and gold markets. Investigating the influence of tariff incidents on financial markets can assist investors in understanding market conditions and mitigating risks, while also enabling governments to refine relevant laws and regulations and standardize market operations. This study analyzes the closing prices of the Shanghai Stock Exchange Composite Index (SSEC Index) and the London Gold Fix from January 5, 2015, to April 23, 2025. Using the tariff shock as a demarcation point, an ARIMA model is constructed based on data from the pre-tariff-shock period. Short-term forecasts are then generated, and a comparative analysis between the forecasted and actual values is conducted. The findings reveal that tariff incidents have a negative short-term impact on the stock market and a positive short-term effect on the gold market. In response to tariff incidents, investors should dynamically adjust their asset allocations according to their risk preference. For stock holdings, it may be prudent to moderately reduce positions to hedge against short-term volatility risks. Conversely, for gold assets, investors could consider moderately increasing allocations to capitalize on short-term appreciation opportunities. However, it is essential to note that long-term investment strategies should still comprehensively consider various market factors and their dynamics.

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Publication Details

Journal
Highlights in Business Economics and Management
Published
2025-09-04
DOI
https://doi.org/10.54097/sc0dxg41
Primary Topic
Market Dynamics and Volatility
Type
article
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article

Research on the Impact of Tariff Incidents on the Stock and Gold Markets: An empirical analysis based on the ARIMA model

Yiyang Wang
Highlights in Business Economics and Management
Market Dynamics and Volatility
article

Research on the Impact of Tariff Incidents on the Stock and Gold Markets: An empirical analysis based on the ARIMA model

Yiyang Wang
article en

Abstract

The tariff incidents have exerted a profound impact on global financial markets, significantly affecting both the stock and gold markets. Investigating the influence of tariff incidents on financial markets can assist investors in understanding market conditions and mitigating risks, while also enabling governments to refine relevant laws and regulations and standardize market operations. This study analyzes the closing prices of the Shanghai Stock Exchange Composite Index (SSEC Index) and the London Gold Fix from January 5, 2015, to April 23, 2025. Using the tariff shock as a demarcation point, an ARIMA model is constructed based on data from the pre-tariff-shock period. Short-term forecasts are then generated, and a comparative analysis between the forecasted and actual values is conducted. The findings reveal that tariff incidents have a negative short-term impact on the stock market and a positive short-term effect on the gold market. In response to tariff incidents, investors should dynamically adjust their asset allocations according to their risk preference. For stock holdings, it may be prudent to moderately reduce positions to hedge against short-term volatility risks. Conversely, for gold assets, investors could consider moderately increasing allocations to capitalize on short-term appreciation opportunities. However, it is essential to note that long-term investment strategies should still comprehensively consider various market factors and their dynamics.

Highlights in Business Economics and ManagementVol. 62
Shanghai Jiao Tong University (CN)
Openalex Percentile: Top 62%
Market Dynamics and Volatility
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