Relationship between investor sentiment and earnings news in high‐ and low‐sentiment periods

The publication of quarterly results of publicly traded companies can have a significant impact on the valuation of their shares. This is mainly concerned with the valuation of the shares, whether it is correct, and at the same time as a prediction of the overall annual financial results. It In most of the analysed companies, we found that most of the year-on-year changes were negative. It is also not possible to draw a clear conclusion about the linear relationship between the percentage change pf surprises and the change in the market price of shares. It should also be noted that the share price in the monitored days may be affected by the current market situation. What this means in practice is that, despite the positive results and the negative mood, stock prices can end up in negative values. However, this situation was not the subject of our research. Therefore, we used a correlation coefficient for this dependence, which represent the mutual movement.

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“…Lastly, we document that short selling information improves the accuracy of earnings forecasts. Similarly Li et al [5]:…”

Section: Estimation Of Epsmentioning

confidence: 89%

Is it Possible to Predict Earnings per Share?

Kmeťko

Hyránek

2021

SHS Web Conf.

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“…Further, market volatility measured with the VIX has greater influence on market returns during recessions. Li, Tian, Ouyang, and Wen (2020) concur, concluding that positive and negative sentiments lead to rises and falls in the returns of Chinese equity markets. Niţoi and Pochea (2020) examined the European markets using contagion and timevarying analysis and concluded that investors' perceptions are an important channel for the movement of markets in any direction, especially during times of crisis and economic uncertainty.…”

Section: Introductionmentioning

confidence: 91%

Impact of Covid-19 on Cryptocurrencies: Evidence on Information Transmission Through Economic and Financial Market Sentiments

Shakri

Yong

Xiang

2021

AFL

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This paper investigates the relationship between the COVID-19 crisis and the two leading cryptocurrencies, Bitcoin and Ethereum, from 31 December 2019 to 18 August 2020. We also use an economic news sentiment index and financial market sentiment index to explore the possible mechanisms through which COVID-19 impacts cryptocurrency. We employ a VAR Granger Causality framework and Wavelet Coherence Analysis and find the cryptocurrency market was impacted in the early phase of the sample period through economic news and financial market sentiments, but this effect diminished after June 2020.

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“…But these studies ignore the effect of investor sentiment. Based on the behavioral finance theory, a growing number of studies have found that investor sentiment has a significant impact on the market reaction to announcements in China’s stock market (Li et al, 2021). Behavioral finance theory draws on the research results of experimental psychology.…”

Section: Literature Review and Theoretical Hypothesismentioning

confidence: 99%

Do the Securities Analysts Play the Role of Information Competition or Information Supplement? Empirical Analysis Based on Investor Sentiment

Liu

et al. 2021

SAGE Open

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The purpose of this article is to investigate the role of securities analysts in Chinese stock market. Taking the earnings announcements of listed companies, analysts’ earnings forecast and analysts’ recommendations in Chinese stock markets from 2014 to 2018 as the samples, this paper explores the influence mechanism of investor sentiment on the market reaction to announcements, and investigates the influence mechanism of investor sentiment on the role of securities analysts under the framework of behavioral finance theory. On the basis of theoretical analysis, this paper empirically tests the relationship between the information content of analysts’ reports and the information content of the earnings announcements from the perspective of behavioral finance, and discusses the role of securities analysts in the stock market. The results show that during the periods of high investor sentiment, securities analysts do not demonstrate the role of information competition or information supplement. On the other hand, during the periods of low investor sentiment, securities analysts play the role of information competition or information supplement. Furthermore, after excluding the investor sentiment component of the market reaction to announcements, securities analysts do not demonstrate the role of information competition, but play the role of information supplement. The findings of this study offer new insights into the role securities analysts play in Chinese stock market, which is conducive to improving the quality of analysts’ reports, thus enhancing the efficiency of the securities market.

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Relationship between investor sentiment and earnings news in high‐ and low‐sentiment periods

Cited by 23 publications

References 81 publications

Is it Possible to Predict Earnings per Share?

Is it Possible to Predict Earnings per Share?

Impact of Covid-19 on Cryptocurrencies: Evidence on Information Transmission Through Economic and Financial Market Sentiments

Do the Securities Analysts Play the Role of Information Competition or Information Supplement? Empirical Analysis Based on Investor Sentiment

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