Research On The Influence Of Media Reports And Stock Prices

It has been widely believed that the news media will cause price changes in the stock market,but its mechanism of action is still not clear enough.Since China is in the development stage of the emerging capital market,irrational small and medium investors account for the main body,so they are more susceptible to external influences.At the same time,driven by current commercial interests,the news media no longer only play a fair and reasonable role of information dissemination.It will influence the investors' attention and thinking methods in the market through its unique “Agenda setting function”,then affect its decisions and investment behavior.In summary,the media has affected the stock price changes by publishing reports,and because the functions of its agenda setting shape investor sentiment,then we have reason to infer that investor sentiment may play a mediating role in the process of media reports affecting stock price changes.On the basis of this theoretical research,this paper takes the empirical data of China's capital market from 2013 to 2016,and the media reports of the four major securities newspapers on the overall stock market commentary as a research sample,constructing a comprehensive indicator of investor sentiment,and empirically testing the tendency of media reports to play a role in stock prices,which also examines whether different media reports tend to have different effects on stock prices,validates the function of media reports on investor sentiment.On this basis,the paper further explores the mediating role of investor sentiment in the process of media reports affecting stock price changes,and clarifies the mechanism of action and conduction path between the three.This will help market participants can understand the relationship between China's media,investors and the market better,and take corresponding measures to improve their respective roles in the capital market.Based on China's unique institutional background,we discuss the influence of media reports on the stock market and the mediating effect of investor sentiment in this process.The main contribution of this paper is: in the context of the institutional environment,this article uses media reports as a starting point to build a bridge of investor sentiment,and uses agenda setting theory,behavioral finance theory to explore the role of news reporting in the capital market,not only Supporting the academic research on the huge influence of media reports on the capital market,it has re-examined the “shaping” function of media reports on investor sentiment and proved the part of investor sentiment in the process of media reports affecting stock prices.Mediation effect.On the one hand,it helps to expand the transmission mechanism and path research between media reports,investor sentiment and stock market,and on the other hand,it helps to better understand the role of media in China's capital market.The conclusions of the study indicate that: 1.Media reports tend to have a significant impact on stock prices,and media reports with different attitudes have different effects on stock prices.Specifically: positive media reports will lead to an increase in stock prices,neutrality and negative media reporting will cause stock prices to fall.2.Media reports tend to have a shaping effect on investor sentiment.Media information,as a signal of the stock market,can influence investors' changes in the future expectations and judgments of the stock market through the “Agenda setting” function of the media.3.In the process of media reports tending to affect stock prices,at least in part through the channels of investor sentiment,investor sentiment plays a part of the intermediary effect.This shows that media reports influence investors' current or expected views on the stock market by providing information and adjusting issues,so that they can change their investment decisions and thus affect the stock market.In the stock market,the media mainly plays an indirect role in amplifying the impact of investor sentiment on stock prices.4.After the robustness test,the main conclusions of this paper remain unchanged,which indicates that the empirical results of this paper are relatively stable and have certain statistical significance.The research implications of this paper are: 1.From the perspective of the news media.The media should remain neutral in the process of information dissemination,try its best to be fair and objective,continuously improve its professional capabilities,and enhance independence and social responsibility.2.From the perspective of investors.Rationally look at media reports and stock price fluctuations,sum up the news media's predictive role in the securities market,do not blindly follow the trend,reduce the irrational behavior of investment.3.From the perspective of the regulator.From the actual situation in China,the regulatory agencies draw on the experience of overseas mature markets to ensure regulatory independence,improve investor structure,and advocate rational and value investment concepts.