News events and Price movements cial markets. As it seems, the media are not just observers, they are movers of markets Knowing what will be importantis the slogan of the German edition of the Financial Times. Facts make money" explains the German investment magazine Focus Money. Profit from it' promises US finance television CNBC. Such slogans nurture the idea of news producers as visionary fore- casters or powerful movers of markets. It is in the medias commercial interest to convince the public that their news move stock prices. For the higher the potential of business coverage to forecast or influence stock prices, the higher the benefit that can be expected from intensive media consumption. This again increases the incentive to buy such media products Actual or supposed market manipulations also nurture the idea of the media as influential movers of stock prices: In numerous cases, business journalists or their contact persons in the industry were accused of having influenced in- vestment behavior through well-directed publications of investment tips and exaggerated forecasts of price movements in order to manipulate the prices of certain market values. For some time, such attempts of instrumentalizing the press and television became the content of media coverage themselves. Sup- posed manipulation attempts in financial shows on television received partici lar attention.& On the other hand, many investors had to realize with the breakdown of the New Economy that the potential of the business media to move stock prices is a lot smaller than individual cases of manipulation seem to suggest: While the media were still dreaming of a permanent stock market upswing, the financial markets crashed and shattered the hopes of many investors. But the journalists stuck to their positive message: Even in the middle of the stock market crisis, the number of buy recommendations by far exceeded the number of sell rec- ommendations. Obviously, the business media neither serve as an early warn- ing system nor as reliable forecasters or makers of stock prices. Is the pub lished information not relevant to stock prices after all? Despite self-confident statements of certain media or finance professionals, the actual quality of the interaction of markets and the media is far from being established. On the part of finance studies, the topic has received a lot of atNews Events and Price Movements cial markets. As it seems, the media are not just observers, they are movers of markets. “Knowing what will be important” is the slogan of the German edition of the Financial Times. “Facts make money” explains the German investment magazine Focus Money. “Profit from it” promises US finance television CNBC. Such slogans nurture the idea of news producers as visionary fore￾casters or powerful movers of markets. It is in the media’s commercial interest to convince the public that their news move stock prices. For the higher the potential of business coverage to forecast or influence stock prices, the higher the benefit that can be expected from intensive media consumption. This again increases the incentive to buy such media products. Actual or supposed market manipulations also nurture the idea of the media as influential movers of stock prices: In numerous cases, business journalists or their contact persons in the industry were accused of having influenced in￾vestment behavior through well-directed publications of investment tips and exaggerated forecasts of price movements in order to manipulate the prices of certain market values.6 For some time, such attempts of instrumentalizing the press and television became the content of media coverage themselves.7 Sup￾posed manipulation attempts in financial shows on television received particu￾lar attention.8 On the other hand, many investors had to realize with the breakdown of the New Economy that the potential of the business media to move stock prices is a lot smaller than individual cases of manipulation seem to suggest: While the media were still dreaming of a permanent stock market upswing, the financial markets crashed and shattered the hopes of many investors. But the journalists stuck to their positive message: Even in the middle of the stock market crisis, the number of buy recommendations by far exceeded the number of sell rec￾ommendations.9 Obviously, the business media neither serve as an early warn￾ing system nor as reliable forecasters or makers of stock prices. Is the pub￾lished information not relevant to stock prices after all? Despite self-confident statements of certain media or finance professionals, the actual quality of the interaction of markets and the media is far from being established. On the part of finance studies, the topic has received a lot of at- 5