Emotions, moods and hyperreality: social media and the stock market during the first phase of COVID-19 pandemic

Abstract

PurposeThis paper aims to expand the emerging literature on COVID-19 and the financial markets by searching for a relationship between the uncertainty of the first phase of the COVID-19 pandemic experienced through social media and the extreme volatility of the Italian stock market.Design/methodology/approachThe authors analyze the relationship between social media and stock market trends during the first phase of the COVID-19 pandemic through the lens of social theory and Baudrillard's simulacra and hyperreality theory. The authors conducted the data analysis in two phases: the emotional and Granger correlation analysis by using the KPI6 software to analyze 3,275,588 tweets for the predominant emotion on each day and observe its relationship with the stock market.FindingsThe research results show a significant Granger causality relation between tweets on a particular day and the closing price of the FTSE MIB during the first phase of the COVID-19 epidemic. The results highlight a strong relationship between social media hyperreality and the real world. The study confirms the role of social media in predicting stock market volatility.Research limitations/implicationsThe findings have theoretical and practical implications as they reveal the relevance of social media in our society and its relationship with businesses and economies. In an emergency, social media, as an expression of users' feelings and emotions, can generate a state of hyperreality that is strong correlated with reality. Since social media allows users to publish and share messages without any filter and mediation, the hyperreality generated is affected by highly subjective elements.Originality/valueThis research is different from the previous ones on the same topic because unlike previous studies, conducted under normal or simulated scenarios, this study is focused on the first phase of an unpredictable and unforeseen emergency event: the COVID-19 pandemic. This research adopts a multidisciplinary approach and integrates previous studies on the economic and financial effects generated by social media by applying well-known theories to a new and unexplored context. The study reveals the significant impact generated by social media on stock markets during a global pandemic.

COVID-19 research in management: An updated bibliometric analysis

“… Impacts on Economy(Red) Disruption, Digitalization, Stock Market. Adams-Prassl et al (2021), Amankwah-Amoah et al, 2021 , Lazzini et al, 2021 . Public Policy & Public Leadership (Green) Public Governance, Emergency Management, Public Disasters, Disaster Response, Intergovernmental Relations.…”

“…First, the evolution of the literature on the impacts of COVID-19 has been swift, and thus, shorter periods make more sense for uncovering the developments of the literature. In fact, the effects of the pandemic on the economy, businesses, and human interactions have been profound (e.g., Lazzini et al, 2021 , Kalenkoski and Pabilonia, 2021 ), and consequently, significant resources have been invested in a short period of time in studying how COVID-19 has impacted businesses, resulting in an impressive body of scholarly publications since 2020. Second, since the beginning of the pandemic, the focus of studies has constantly changed, which requires shorter periods for studying the development of the literature.…”

“…As a demonstration, forecasting the aftermaths of the COVID-19 shock on the stock market is among the most popular research topics in this theme. As an example of studies in this theme, Lazzini et al (2021) use social media data and show that emotions expressed in social media can significantly predict stock market volatility. Further, Amankwah-Amoah et al (2020) show how the pandemic has driven the digitalization of the economy around the globe and future opportunities for economic growth.…”

Sign Consumption and Fetishism Behind the Hyperreality of Plant Collection Trends During a Pandemic

“…People pay attention to reality through words, sentiments, moods, and images. During the lockdown, social media is a fundamental aspect of social cohesion and human relations, a place where the real and the virtual suddenly overlap (Lazzini et al, 2021). Considering every content that is exchanged between users as a simulacrum, the ornamental plant content gives rise to a hyperreality that has characterized and influenced so many people.…”

Transformasi Makna Leksikal dalam Bahasa Indonesia Mutakhir: Analisis Wacana Termediasi Komputer

“…Transformasi Makna Leksikal dalam Bahasa Indonesia Mutakhir: Analisis Wacana Termediasi Komputer. Suar Betang, 17 (2)…”