News and Money in Times of PoliticalInstability: Measuring the Expressivity ofNewspaper Articles and its Effect on thePeso-Dollar Exchange Rate and thePhilippine Stock Market Index

Abstract

Stock market analysts would indicate the lack of encouraging political and economic news that resulted in the tumbling stock market index. These pieces of information are published in newspapers that have been tailored by writers and editors to conform to certain journalistic style, adding their appreciation on the event. Thus a certain piece of information may be written and published in a negative, positive or neutral manner. This research created a method for measuring the expressivity or the negativeness, positiveness or neutralness of media-information called Expressivity Rating. The Expressivity Rating of political and economic articles published in four leading newspapers in the Philippines was correlated with the Philippine Stock Market Index and Foreign Exchange Rate. The problem is to find out if media-information can affect the performance of the Philippine bourse and the Philippine Peso against the US Dollar during the 2004 Philippine national elections. This research found relatively high correlation and significant multiple regression models indicating that media-information measured in Expressivity Rating can affect the performance of the stock market and foreign exchange.