• The number of Covid-19 pandemic cases per million has significant negative effects on global financial markets. • The adverse effects of the coronavirus on the stock markets are less in freer countries. In other words, the stock markets of less-free countries are affected more by the same size of increase in the number of coronavirus cases. • For every increase in the growth of number of Covid-19 cases per million, the stock market returns in freer countries are associated with less return decreases. • Even though the growth of the number of Covid-19 cases per million increases the volatility in less-free countries, its effect on freer countries is not statistically different from zero.
Freedom and Stock Market Performance during Covid-19 Outbreak