Oil Price Shocks and the Stock Market: The Good, the Bad and the Indifferent
May 22, 2008 - Economic Indicators
Does the U.S. stock market reliably decline in response to a positive crude oil price shock? In their March 2007 paper entitled “The Impact of Oil Price Shocks on the U.S. Stock Market”, Lutz Kilian and Cheolbeom Park investigate complexities in the relationship between U.S. stock returns and crude oil prices according to the causes of oil price shocks. Using data for crude oil prices, aggregate (value-weighted) stock returns and inflation over the period January 1975 through September 2005, they conclude that: Keep Reading