Sentiment Analysis

FiND Sentiment Indicator turns bearish 4-days prior to DJIA crash on October 10

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The Dow Jones Industrial Average (DJIA) index witnessed a significant fall in the past week amid concerns over a surge in bond yields and trade war between the US and China. In our view, news sentiment based strategy can help investors to predict an impending movement in the market.

Heckyl has developed FiND Sentiment Indicator which reflects the underlying sentiment of news coverage on the companies within the index. The moving average strategy based on FiND Sentiment Indicator signals the potential impact of the news sentiment on the value of the underlying index.

For instance, FiND Sentiment Indicator turned bearish 4-days prior to the 832 points crash in the DJIA index on October 10 (Image 1). Our system analyzed 1,01,066 news items for 30 companies within the DJIA index for the past 6-months. Out the total, 74,780 news items were positive, while 26,286 news items were negative.
DJIA Sentiment - Signals
[Image 1: Bullish/ Bearish Signals defined by Sentiment Indicator Strategy vs. DJIA]
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Air India continues to lead news share of voice for 2nd quarter

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India’s national carrier Air India led the news share of voice (SoV) among major airlines for the second quarter in a row. On the other hand, the news SoV for Interglobe Aviation remained at the second position in the June 2018 quarter. Meanwhile, Jet Airways and SpiceJet’s news SoV for the quarter stood at third and fourth positions respectively.

Airlines Share of Voice
[Image 1: Top 4 airlines’ web news share of voice]
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Sun Pharma’s positive news volume jumps in Q1 to highest level in past 4-quarters

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Sun Pharmaceutical Industries witnessed a significant improvement in the positive media coverage during the June 2018 quarter. Regulatory approvals and encouraging earnings led the positive news coverage for Sun Pharma in the June 2018 quarter.

At the same time, the volume of negative news has also dropped sharply in the same period. As a result, the long-term news sentiment has improved towards the end of the quarter.

Moreover, the improvement in news sentiment was also reflected in the recent rally in Sun Pharma’s stock price. Net-net, the news cycle was favorable for India’s leading drug maker in the June 2018 quarter.

Sun Pharma
[Compare screen: Sun Pharma – Share Price, News Volume, and Sentiment]

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IndiGo most affected airline by disruption in flight services: FiND media study

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An analysis of media coverage on the leading air carriers in India has shown that Interglobe Aviation was the most affected airline by the disruption in flight services during the past 5-months.

Interglobe Aviation, the operator of IndiGo Airlines has dominated disruption related news flow among major Indian airlines in the past 5-months. It was followed by Air India and Jet Airways. On the other hand, SpiceJet attracted fewer news items related to disruption.

Airlines Compare
[Image 1: Compare news volume by sentiment and/ or category]

Technical issues, engine failure (A320 Neo planes), and flight delays & cancellations have disrupted operations of IndiGo Airlines during the past 5-months. Read the rest of this entry »

FiND Sentiment-based Strategy beats STI companies’ 1-year stock returns

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Heckyl has developed FiND sentiment moving average (MA) strategy for measuring the potential impact of the positive/ negative news flow on the value of equities in real-time. The sentiment MA strategy indicates bullish/bearish signals based on the crossover of fast and slow moving averages of the company’s daily sentiment score.

We back-tested our sentiment MA strategy on 27 companies (excl. banks) from Straits Times index (STI). Our back-testing has proved the potential of sentiment MA strategy to beat STI companies’ stock price performance.

If an investor/a trader was to buy/sell STI stocks as per the bullish/bearish signal and hold the position for the period till the signal reverses, then an equal investment in 27 STI stocks could have yielded 6.3% return over the past 1-year (as against 0.3% price return).

STI Returns
[Image 1: Investment performance based on sentiment signal and stock performance]

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Infosys leads media share of voice, but TCS takes the cake

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India’s second largest IT firm, Infosys led the media share of voice (both web and social) among the top 5 software companies during the fourth quarter earnings season. It was followed by Tata Consultancy Services (TCS), the largest software company in India.

Web & Social Share of voice[Image 1: Share of Voice (as on Apr. 26, 2018)]

Though Infosys topped the media share of voice, TCS has performed better on the tonality of news coverage.

TCS received extremely positive media coverage after India’s largest IT firm reported better-than-expected quarterly earnings. Meanwhile, positive earnings coverage has lifted TCS’s news sentiment 100-day moving average (DMA) to the highest level in the past 9-months.

On the other hand, underlying news sentiment for India’s second largest software company was mostly negative due to lukewarm Q4 earnings and disappointing guidance for FY19. As a result, Infosys witnessed a drop in news sentiment 100-DMA after disclosing quarterly results.

Compare Sentiment 100 DMA[Image 2: Compare screen – News sentiment 100-DMA chart]

FiND Media Monitoring Tool offers high-end media analytics by tracking news coverage patterns and analyzing movement in underlying sentiment in real-time for all listed and unlisted companies globally.

To know more about FiND Media Monitoring Tool, email us at info@heckyl.com

These 3 companies witness drop in long-term news sentiment to 2-year low

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FiND media coverage study for BSE 100 index companies showed a significant deterioration in the long-term news sentiment for Glenmark Pharmaceuticals, Vakrangee and fraud-hit Punjab National Bank (PNB).

These 3 companies have been receiving negative press coverage for quite some time. As a result, news sentiment 200-day moving average (DMA) for these 3 companies dipped to a 2-year low on Apr. 17, 2018.

BSE 100 Sentiment 200 DMA - 17-April-18[Image 1: Compare screen shows Sentiment 200-DMA] Read the rest of this entry »