Market resilience in turbulent times: a proactive approach to predicting stock market responses during geopolitical tensions
Purpose – The Indian stock market can be tricky when there's trouble in the world, like wars or big conflicts. It's like trying to read a secret message. We want to figure out what makes investors nervous or happy, because their feelings often affect how they buy and sell stocks. We'r...
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| Format: | Article |
| Language: | English |
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Emerald Publishing
2024-11-01
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| Series: | Journal of Capital Markets Studies |
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| Online Access: | https://www.emerald.com/insight/content/doi/10.1108/JCMS-12-2023-0049/full/pdf |
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| _version_ | 1846159781134336000 |
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| author | Srivatsa Maddodi Srinivasa Rao Kunte |
| author_facet | Srivatsa Maddodi Srinivasa Rao Kunte |
| author_sort | Srivatsa Maddodi |
| collection | DOAJ |
| description | Purpose – The Indian stock market can be tricky when there's trouble in the world, like wars or big conflicts. It's like trying to read a secret message. We want to figure out what makes investors nervous or happy, because their feelings often affect how they buy and sell stocks. We're building a tool to make prediction that uses both numbers and people's opinions. Design/methodology/approach – Hybrid approach leverages Twitter sentiment, market data, volatility index (VIX) and momentum indicators like moving average convergence divergence (MACD) and relative strength index (RSI) to deliver accurate market insights for informed investment decisions during uncertainty. Findings – Our study reveals that geopolitical tensions' impact on stock markets is fleeting and confined to the short term. Capitalizing on this insight, we built a ground-breaking predictive model with an impressive 98.47% accuracy in forecasting stock market values during such events. Originality/value – To the best of the authors' knowledge, this model's originality lies in its focus on short-term impact, novel data fusion and high accuracy. Focus on short-term impact: Our model uniquely identifies and quantifies the fleeting effects of geopolitical tensions on market behavior, a previously under-researched area. Novel data fusion: Combining sentiment analysis with established market indicators like VIX and momentum offers a comprehensive and dynamic approach to predicting market movements during volatile periods. Advanced predictive accuracy: Achieving the prediction accuracy (98.47%) sets this model apart from existing solutions, making it a valuable tool for informed decision-making. |
| format | Article |
| id | doaj-art-dc1321e7931f4d46b072c7698eedbce5 |
| institution | Kabale University |
| issn | 2514-4774 |
| language | English |
| publishDate | 2024-11-01 |
| publisher | Emerald Publishing |
| record_format | Article |
| series | Journal of Capital Markets Studies |
| spelling | doaj-art-dc1321e7931f4d46b072c7698eedbce52024-11-23T05:14:06ZengEmerald PublishingJournal of Capital Markets Studies2514-47742024-11-018217319410.1108/JCMS-12-2023-0049Market resilience in turbulent times: a proactive approach to predicting stock market responses during geopolitical tensionsSrivatsa Maddodi0Srinivasa Rao Kunte1Department of Computer Science, Srinivas University, Mangaluru, IndiaDepartment of Computer Science, Srinivas University, Mangaluru, IndiaPurpose – The Indian stock market can be tricky when there's trouble in the world, like wars or big conflicts. It's like trying to read a secret message. We want to figure out what makes investors nervous or happy, because their feelings often affect how they buy and sell stocks. We're building a tool to make prediction that uses both numbers and people's opinions. Design/methodology/approach – Hybrid approach leverages Twitter sentiment, market data, volatility index (VIX) and momentum indicators like moving average convergence divergence (MACD) and relative strength index (RSI) to deliver accurate market insights for informed investment decisions during uncertainty. Findings – Our study reveals that geopolitical tensions' impact on stock markets is fleeting and confined to the short term. Capitalizing on this insight, we built a ground-breaking predictive model with an impressive 98.47% accuracy in forecasting stock market values during such events. Originality/value – To the best of the authors' knowledge, this model's originality lies in its focus on short-term impact, novel data fusion and high accuracy. Focus on short-term impact: Our model uniquely identifies and quantifies the fleeting effects of geopolitical tensions on market behavior, a previously under-researched area. Novel data fusion: Combining sentiment analysis with established market indicators like VIX and momentum offers a comprehensive and dynamic approach to predicting market movements during volatile periods. Advanced predictive accuracy: Achieving the prediction accuracy (98.47%) sets this model apart from existing solutions, making it a valuable tool for informed decision-making.https://www.emerald.com/insight/content/doi/10.1108/JCMS-12-2023-0049/full/pdfGeopolitical tensionStock market predictionSentiment analysisMomentum indicatorLSTM |
| spellingShingle | Srivatsa Maddodi Srinivasa Rao Kunte Market resilience in turbulent times: a proactive approach to predicting stock market responses during geopolitical tensions Journal of Capital Markets Studies Geopolitical tension Stock market prediction Sentiment analysis Momentum indicator LSTM |
| title | Market resilience in turbulent times: a proactive approach to predicting stock market responses during geopolitical tensions |
| title_full | Market resilience in turbulent times: a proactive approach to predicting stock market responses during geopolitical tensions |
| title_fullStr | Market resilience in turbulent times: a proactive approach to predicting stock market responses during geopolitical tensions |
| title_full_unstemmed | Market resilience in turbulent times: a proactive approach to predicting stock market responses during geopolitical tensions |
| title_short | Market resilience in turbulent times: a proactive approach to predicting stock market responses during geopolitical tensions |
| title_sort | market resilience in turbulent times a proactive approach to predicting stock market responses during geopolitical tensions |
| topic | Geopolitical tension Stock market prediction Sentiment analysis Momentum indicator LSTM |
| url | https://www.emerald.com/insight/content/doi/10.1108/JCMS-12-2023-0049/full/pdf |
| work_keys_str_mv | AT srivatsamaddodi marketresilienceinturbulenttimesaproactiveapproachtopredictingstockmarketresponsesduringgeopoliticaltensions AT srinivasaraokunte marketresilienceinturbulenttimesaproactiveapproachtopredictingstockmarketresponsesduringgeopoliticaltensions |