Analysis of the Effect of News Sentiment on Stock Market Prices through Event Embedding

Abstract

Stock market price prediction models have remained a prominent challenge for the investors owing to their volatile nature. The impact of macroeconomic events such as news headlines is studied here using a standard dataset with closing stock price rates for a chosen period by performing sentiment analysis using a Random Forest classifier. A Bi-LSTM time-series forecasting model is constructed to predict the stock prices by using the polarity of the news headlines. It is observed that Random Forest Classifiers predict the polarity of news articles with an accuracy of 84.92%.