Highlighting the Role of Morality in News Framing and Its Short-Term Effects on Stock Market Fluctuations

The Model of Intuitive Morality and Exemplars (MIME) suggests that news audiences, including investors, evaluate news based on their moral frames, and that these moral evaluations shape behavior. We extracted moral signals from 382,185 news articles across an 8-month period and examined their predictive effect on stock market movement. Results indicate that morality is a strong predictor during low economic periods and is driven by subversion and sanctity. Overall, our study suggests that moral framing and its foundations are important considerations for research on news effects, especially during periods of economic instability. The study provides an additional theoretical perspective on stock market fluctuations as well as practical implications for stakeholders with an interest in dampening collective panics and stabilizing investor sentiment.