Effects of the European central Bank's monetary policy on european stock markets: an empirical analysis (2010-2024)

Identifier:  TFG:9683

Handle: https://hdl.handle.net/20.500.11797/TFG9683

Authors:  Carbonell Silva, Aleix

Abstract:
This study empirically analyzes the impact of the European Central Bank's monetary policy on European stock markets during the 2010–2024 period, using a Vector Autoregressive (VAR) model. The results demonstrate that European markets (Euro Stoxx 50, IBEX 35, and the banking sector) operate with a high degree of informational efficiency: ECB decisions are already priced into the markets before they materialize, thanks to forward guidance. Furthermore, the study reveals symmetric financial integration between the Eurozone core and periphery, with economic sentiment acting as the primary driver of stock market volatility.