How do financial markets respond to the impact of earthquakes? We investigate this for more than 100 earthquakes with fatalities in 21 countries from five continents in the period 1973–2011. Using an event study methodology we conclude that there are significant negative effects on stock market value. We find that the stock market's response to earthquakes is more pronounced in recent years than in the 1970s and 1980s. There is no difference in the responses to the most and least severe earthquakes or to those in high-income and low-income countries. There is hardly a significant difference in the response to earthquakes in German law–based countries and English or French law–based countries. This suggests that the stock market is not very sensitive regarding key characteristics of earthquakes.
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