Which Media Sources Really Move the Market?
There are so many reasons why we would want an answer to this question. Which publications should investors read? Where should a PR firm send press releases? How much is a publication worth? Are all “column inches” equal? And for systematic news analytics models, should certain publications be over or underweighted?
Technically, whoever got the scoop moved the market. So the most scoops wins, right? Or is it that certain publications move markets regardless of scoops. I suspect the latter – but it’s a moot point because we still want to know which the most influential publications are.
As with most things, the answer to our original question is ‘it depends’. Our research, based on RavenPack News Analytics 4.0 and Russell 3000 stocks, explores the dependencies of market capitalization, event type and sector. You can request a copy of our research here. The data used was the most relevant and novel news from the over 19,000 publications analysed in RPNA 4.0. Market impact was measured as the return spread between positive and negative events the trading day following the news release.
Figure 1 shows the winners are TheStreet for large caps, Morningstar.com and PR Newswire for mid-caps and PR Newswire for small caps. But also note the Houston Chronicle is up there and the San Francisco Chronicle has a large negative impact in the large cap space. It’s perhaps intuitive that PR Newswire is the most impactful in small caps given they are not editorially selective as to which stories they cover or publish.
In terms of event type and sector, Table 1 below shows the return spreads for publications by industry and Table 2 the ‘most influential’ publication for each event type.
It must be said that full content is missing from some of these publications in RPNA 4.0, so the results might be different if there was perfect access to all publications. It is interesting, nonetheless, knowing things like if you’re representing a large cap, get your news into TheStreet, small caps can’t afford to ignore PR Newswire for distribution and that the Houston Chronicle is worth watching…