 Do stress and overstatement in the news affect the stock market? Evidence from COVID-19 news in The Wall Street JournalFederico Carlini, Vincenzo Farina, Ivan Gufler and Daniele Previtali International Review of Financial Analysis, 2024, vol. 93, issue C Abstract: This study investigated the effect of media coverage on financial markets in response to COVID-19-related news. By collecting data from the United States Centers for Disease Control and Prevention, we study the effect of The Wall Street Journal's coverage and tone on stock markets. In particular, we attempted to measure media overstatements by comparing the number of articles and stress words with the number of COVID-19 cases. We obtained three main findings. First, investors discount macroeconomic news and objective measures of COVID-19. Second, excessive stress in the media tone leads to greater uncertainty and lower returns. Third, these results hold across sectors, although heterogeneity exists. Overall, long periods of high-stress sentiment and uncertainty affect investors more than single-day news. Keywords: COVID-19; Stock markets; Media sentiment (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:finana:v:93:y:2024:i:c:s1057521924001108 DOI: 10.1016/j.irfa.2024.103178 Access Statistics for this article International Review of Financial Analysis is currently edited by B.M. Lucey More articles in International Review of Financial Analysis from Elsevier |
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