Abstract: This paper used the VAR-BEKK-GARCH model to conduct a comparative study on the linkage and spillover effects between the carbon emission trading price,the carbon neutral 300 index and the thermal power index before and after the outbreak of the COVID-19 epidemic in 2019 and 2020.The results showed that the carbon market price index was a partial cause of changes in the carbon neutral concept stock index and thermal power stock index,and this relationship had become more apparent after the epidemic.The psychological factors of investors,such as cognitive errors,framing effects,and psychological biases,played core roles in capital market pricing.The economic fluctuations caused by the epidemic had exacerbated the impact of these psychological factors.The study pointed out that although the COVID-19 had an impact on China’s carbon neutrality process in the short term,in the long run,the government’s green and low-carbon development strategy pointed out the direction for sustainable development,and also prompted investors to pay more attention to green and low-carbon industries.In addition,this study also provided financial market policy guidance for the carbon and stock markets,emphasizing the importance of improving legal regulation and introducing financial derivatives for achieving carbon neutrality goals.