AI-Driven Financial Foresight

With advances in large language models, Earnings Call Analysis is entering a new era. LSEG MarketPsych Transcript Analytics leverages fine-tuned NLP to extract sentiment, emotion, and topical insights from corporate transcripts.  See our blog on this new approach to extracting investable insights from executive (and analyst) language: https://lnkd.in/geNCjvCJ

Markets just delivered a textbook “relief rally.”  A 2019 study in PLOS ONE (“Relief from incidental fear evokes exuberant risk taking”) paired mild electric shocks with an investment task. When the shock threat was removed, participants’ risk appetite—and the expected value of the options they chose—jumped ~11 %. Takeaways for today’s market:• Relief fuels risk-on behavior. As macro stressors ease, investors systematically bid up risk assets. • It’s valuation, not probability, that shifts. The brain literally assigns higher worth to the same payoff once fear subsides. • Mind the half-life. If talks stall or other threats re-emerge, the reverse can happen just as fast. Behavioral finance reminds us that emotion isn’t noise around fundamentals; it re-prices them. Managing portfolios means managing the emotional cycle too.

In April there was a -12% share price return gap between companies that mentioned tariffs the most vs none in their earnings call transcripts (image). A month ago we posted March's results, when the gap was narrower at -7.5%: https://lnkd.in/g6iY4YRr A new type of news is moving markets. Having the right analytics makes all the difference.

On Monday, we’re launching our Global Leaders Feed — a real-time stream of social and news announcements from influential U.S. cabinet members and global leaders. Why? Because they move markets.💥 Case in point:- Today at 1:18 pm ET (17:18 GMT), President Trump posted on Truth Social that reciprocal tariffs would “PAUSE.”- Within minutes, the U.S. stock market rallied in one of its largest 30-minute moves in history (see image).🔍 And yet — CNBC and other outlets couldn't identify the reason for the surge until after the bulk of the move had already happened. ⚠️ Earlier the same day, China’s retaliatory 84% tariffs were posted on Reddit and X/Twitter — a full 6 minutes before traditional financial media and 9 minutes before a low-latency Reuters ALERT.📰📉📈 Markets Are Moving Faster Than the News 📡 Introducing Media Radar:A real-time NLP-powered feed that extracts early signals from high-impact media platforms. Our feed delivers structured JSON metadata, ready to plug into quant models, signal engines, alerting systems, and portfolio risk tools. NLP Tags Provided:🔹 Entities: 20+ types (stocks, commodities, currencies...)🔹 Topics: 1,000+ (accounting, litigation, tariffs...)🔹 Events: 4,000+ (dividends-payment, factory-build...)🔹 Sentiment: Finance, ESG, commodity scores🔹 Emotions: 14 dimensions (anger, fear, optimism...)For a sample of the Global Leaders feed or a trial of Media Radar:👉 Reach out to: support@marketpsychdata.com👉 Or sign up here: https://lnkd.in/gtUPfc_B

We analyzed mentions of "tariffs" in U.S. earnings calls over the past two decades:🔹 In 23 years of data, only the Trump presidencies saw tariffs become a major boardroom topic. 🔹 During Trump I, it took time for tariff talk to ramp up. 🔹 In Trump II, we've surpassed the prior peak — and the bulk of earnings season hasn't even hit. 🔹 Mentions are now far beyond the previous peak.  👀 Market participants are clearly bracing for geopolitical and trade turbulence. 💬 This time the Trade War does not look like a negotiation tactic.

📉 Get Ready for Turnaround Tuesday in the Stock Market 📈 On Monday, September 15th, 2008, I was in the green room for a financial news segment, preparing to speak on behavioral finance. A CEO of a large equity investment firm was also there. As he left, he turned to me and said: “Get ready for Turnaround Tuesday!” 📊 That Tuesday turned out to be one of the biggest rallies in S&P 500 history.Curious, I looked into it further — and sure enough, the stock market has a quirky history of rallying on Tuesdays following steep Monday selloffs. It’s a known behavioral phenomenon.

Stocks Associated with Tariffs are Tanking We collected all U.S. earnings call transcripts from March 2025 and grouped companies into three buckets: 1️⃣ No mention of tariffs 2️⃣ Mentions tariffs 3️⃣ Mentions tariffs 30+ times in a single earnings conference call Then we looked at April stock returns… 👀  The results speak for themselves:🔵 Companies that didn’t mention tariffs had better average performance🔵 Those that talked tariffs saw worse returns🔵 And frequent tariff talkers? Down over 16% on average.

In the past 24 hours, the companies most positively and negatively associated with "tariffs" in the media. In the image, the horizontal bars represent the average sentiment of co-mentions of the company with "tariffs" in the past 24 hours of media coverage. At least 5 co-references required to be plotted. 👍 Possible beneficiaries (or less-affected) companies include:1. BJ's Wholesale Club - inventory is largely tariff-resistant2. Philip Morris - consumers want their staples (like tobacco) regardless of price.3. Goodyear - competitors are much more affected, so Goodyear will benefit.4. Ferarri - customers are price insensitive.5. First Solar - like Goodyear, the company will benefit from high tariffs on low-cost Chinese competitors. 👎 Among losers, shipper Maersk is sinking (sorry), Best Buy's almost entirely non-US electronics stock is becoming costlier, and Puma's "cheap" shoes are no longer so.