Transformation of Stock Market Threats into Investment Opportunities: Modelling the Dependence of the Indian and Vietnamese Stock Markets on the US–China Trade War

The current state of economic and political relations between the United States and China plays a key role in shaping the future economic and geopolitical picture of the world. The trade war between these superpowers is already having a strong impact on many countries. The article uses ARIMA modelling and correlation-regression analysis to study structural changes in investment policy and development of production capacities in India and Vietnam in the context of the impact of changes caused by the US-China trade war and identifies the functional dependence of the stock market of India and Vietnam in 2014-2014 on the main US and Chinese stock indices. A specific case is chosen for the analysis – the trade war between the United States and China, which has been going on since 2018. A chronological analysis of the events is carried out, and the key stages of escalation and de-escalation of the conflict are described. The impact of sanctions, duties and restrictions on bilateral economic relations and the overall structure of global supply chains is determined. Particular attention is paid to the analysis of the reaction of third countries, in particular India and Vietnam, which were able to use the situation to increase production capacity and attract foreign capital and technology. These countries have demonstrated a high level of flexibility and adaptability and offered favourable conditions for business relocation, which has become a strategic advantage in the face of geo-economic instability. Stock indices of four countries were used for modelling: the US (S&P 500), China (Shanghai Composite), India (BSE Sensex) and Vietnam (VN-Index) as the most representative for analysing investment activity and business expectations. The study collected monthly data for several years, which allowed us to track the dynamics before, during and after the main stages of the conflict. According to the results, the S&P 500 index has had a strong impact on the stock market indicators of India and Vietnam. The values of the standardised coefficients (b*) ranged from 0.76 to 0.98, indicating a strong positive relationship. At the same time, the t-test and p-level confirmed the statistical significance of the impact. In contrast, the Shanghai Composite had a much weaker impact, sometimes even negative. This may indicate a decline in investor confidence in China due to geopolitical instability and attempts to diversify risks. The study proves that trade wars can significantly change the structure of global value chains. Countries that adapt to new conditions in a timely manner and offer attractive opportunities for capital flows are able to benefit from such conflicts. India and Vietnam are examples of countries that have been able to turn a threat into an opportunity.