News Or Noise? The Stock Market Reaction To Different Types Of Internet News

As the rapid development of social media and the coming of Big Data Time, the internet has become the main way to diffuse stock market information. The information source and form based to make financial analysis and investment decisions by investors in stock market are becoming increasingly diversified, and investors' relationship with the internet are becoming increasingly complex. Behaviors of acquiring, processing and using information adopted by investors in complex information environment, unlike previous behaviors, make the fluctuations and changes of stock market to be increasingly affected by the internet.At present, many scholars have begun to use the data on the Internet to research some problems, like the yield and trading volume of the stock market. While, considerable researchers have documented that the stock market responds to published information and the existence of abnormal returns on publication day over different periods. There are two potential hypotheses in previous literature to explain this puzzling reaction. One is the Price Pressure Hypothesis, which suggests that the recommendations create temporary buying pressure by na?ve investors and this pressure causes the observed abnormal returns. The other is the Information Diffusion Hypothesis, which suggests that the recommendations reveal relevant information and the recommendations represents a fundamental revaluation of the stocks.This paper aims to use event study to examine the price and volume response to the firm-specific news(holding news, operation news, profit news and takeover news) mentioned by the “Stock Market Early Know” of Netease Financial Channel. Finally, we give the suggestions for the future development of the government, listed companies, investors and China's financial markets.