Salmon Stock Returns Around Market News

Clemens Knoppe, Mariia Okuneva and Mikaella Zitti

Marine Resource Economics, 2025, vol. 40, issue 2, 107 - 140

Abstract: We examine the relationship between media news and trading behavior in the salmon market. For this, we create a share price index based on five salmon aquaculture companies trading on the Oslo Stock Exchange. We use the latent Dirichlet allocation algorithm to obtain news topics and a lexicon-based sentiment analysis. We find that topics relating to COVID-19 and sustainability have a significant negative impact on the salmon market, while topics on land-based aquaculture have a significant positive impact. The sentiment series based on the Loughran-McDonald lexicon is found to have a negative and insignificant effect on stock returns. Hence, we expand the lexicon with industry-specific words. A negative shock to sentiment within the news related to competitors foreshadows a significant increase in returns owing to the market’s competitive nature. Through our out-of-sample forecasting experiment, we find that the incorporation of news data can improve the predictive performance.

Date: 2025
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