Predict FTSE100 Stock Movements Using Business News Sentiment and Machine Learning

Research Article
Open access

Predict FTSE100 Stock Movements Using Business News Sentiment and Machine Learning

Congjun Jin 1* , Rongzheng Liu 2 , Bangfeng Tang 3 , Bokun Cai 4
  • 1 The School of Environmental and Civil Engineering, University of New South Wales, Sydney 2052, Australia    
  • 2 University of St Andrews, Scotland    
  • 3 Perth College, University of the Highland and Islands, Scotland    
  • 4 Limai Chinese American (International) School, Beijing, China    
  • *corresponding author z5275008@ad.unsw.edu.au
Published on 20 February 2023 | https://doi.org/10.54254/2753-8818/2/20220148
TNS Vol.2
ISSN (Print): 2753-8826
ISSN (Online): 2753-8818
ISBN (Print): 978-1-915371-13-3
ISBN (Online): 978-1-915371-14-0

Abstract

In order for investors to maximize their benefit by having better forecasts of the complex dynamics of the stock market, there are many factors that affect the stock market, from a company's financial ratios to investor sentiment and reactions to financial news. This project aims to collect UK business news from the Guardian and uses NLP techniques to transform unstructured text data into usable structured sentiment data to predict the movement of the FTSE100 index. The program uses two different libraries TEXTBLOB and VADER to extract sentiments from both the headlines and main bodies of the business news articles. Four machine learning algorithms including Logistic Regression, Naive Bayes, K-Nearest Neighbours and Support Vector Machines and a voting classifier were used to predict FTSE100 index movement given the business news sentiments of the previous day.

Keywords:

sentiment analysis, NLP, Stock price prediction

Jin,C.;Liu,R.;Tang,B.;Cai,B. (2023). Predict FTSE100 Stock Movements Using Business News Sentiment and Machine Learning. Theoretical and Natural Science,2,50-55.
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References

[1]. S. Barsa, "Classification of Hot News for Financial Forecast Using NLP Techniques," International Conference on Big Data, New Delhi, 2018.

[2]. S. Mehtab and J. Sen, "A Robust Predictive Model for Stock Price Prediction Using Deep Learning and Natural Language Processing," School of Computing and Analytics, Kolkata, 2019.

[3]. S. Mohan, S. Mullapudi, S. Sammeta, P. Vijayvergia and D. C. Anastasiu, "Stock Price Prediction Using News Sentiment Analysis," 2019 Fifth International Conference on Big Data Computing Service and Applications, New Delhi, 2019.

[4]. R. Akita, A. Yoshihara, T. Matsubara and K. Uehara, "Deep Learning for Stock Prediction Using Numerical and Textual Information," Kobe University, Seoul, 2019.

[5]. S. Kumar and S. Acharya, "Application of Machine Learning Algorithms in Stock Market Prediction: A Comparative Analysis," Indian Institute of Management, Indore, 2020.

[6]. I. Chatterjee, J. Gwan, Y. J. Kim, M. S. Lee and M. Cho, "An NLP and LSTM BasedStock Prediction and Recommender System for KOSDAQ and KOSPI," Intelligent Human Computer Interaction, 2021.

[7]. D. Shah, I. Haruma and F. Zulkernine, "Predicting the Effects of News Sentiments on the Stock Market," School of Computing, Queens University, Kingston, 2019.

[8]. x. Li, H. Xie, L. Chen, J. Wang and X. Deng, "News impact on stock price return via sentiment analysis," City University of Hong Kong, Hong Kong, 2014.

[9]. X. Wan, J. Yang, S. Marinov, J. P. Calliess, S. Zohren and X. Dong, "Sentiment correlation in financial news networks and associated market movements," Nature Portfolio, 2021.

[10]. I. Zheludev, R. Smith and T. Aste, "When Can Social Media Lead Financial Markets," Scientific Reports, 2014.

[11]. M. G. Sousa, K. Sakiyama, L. S. Rodrigues, P. H. Moraes, E. R. Fernandes and E. T. Matsubara, "BERT for Stock Market Sentiment Analysis," International Conference on Tools with Artificial Intelligence, New Delhi, 2019.

[12]. Y. Kim, S. R. Jeong and I. Ghani, "Text Opinion Mining to Analyze News for Stock Market Prediction," Kookmin University, Seoul, 2014.

Cite this article

Jin,C.;Liu,R.;Tang,B.;Cai,B. (2023). Predict FTSE100 Stock Movements Using Business News Sentiment and Machine Learning. Theoretical and Natural Science,2,50-55.

Data availability

The datasets used and/or analyzed during the current study will be available from the authors upon reasonable request.

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About volume

Volume title: Proceedings of the International Conference on Computing Innovation and Applied Physics (CONF-CIAP 2022)

ISBN：978-1-915371-13-3(Print) / 978-1-915371-14-0(Online)
Editor：Michael Harre, Marwan Omar, Roman Bauer
Conference website: https://www.confciap.org/
Conference date: 4 August 2022
Series: Theoretical and Natural Science
Volume number: Vol.2
ISSN：2753-8818(Print) / 2753-8826(Online)

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References

[1]. S. Barsa, "Classification of Hot News for Financial Forecast Using NLP Techniques," International Conference on Big Data, New Delhi, 2018.

[2]. S. Mehtab and J. Sen, "A Robust Predictive Model for Stock Price Prediction Using Deep Learning and Natural Language Processing," School of Computing and Analytics, Kolkata, 2019.

[3]. S. Mohan, S. Mullapudi, S. Sammeta, P. Vijayvergia and D. C. Anastasiu, "Stock Price Prediction Using News Sentiment Analysis," 2019 Fifth International Conference on Big Data Computing Service and Applications, New Delhi, 2019.

[4]. R. Akita, A. Yoshihara, T. Matsubara and K. Uehara, "Deep Learning for Stock Prediction Using Numerical and Textual Information," Kobe University, Seoul, 2019.

[5]. S. Kumar and S. Acharya, "Application of Machine Learning Algorithms in Stock Market Prediction: A Comparative Analysis," Indian Institute of Management, Indore, 2020.

[6]. I. Chatterjee, J. Gwan, Y. J. Kim, M. S. Lee and M. Cho, "An NLP and LSTM BasedStock Prediction and Recommender System for KOSDAQ and KOSPI," Intelligent Human Computer Interaction, 2021.

[7]. D. Shah, I. Haruma and F. Zulkernine, "Predicting the Effects of News Sentiments on the Stock Market," School of Computing, Queens University, Kingston, 2019.

[8]. x. Li, H. Xie, L. Chen, J. Wang and X. Deng, "News impact on stock price return via sentiment analysis," City University of Hong Kong, Hong Kong, 2014.

[9]. X. Wan, J. Yang, S. Marinov, J. P. Calliess, S. Zohren and X. Dong, "Sentiment correlation in financial news networks and associated market movements," Nature Portfolio, 2021.

[10]. I. Zheludev, R. Smith and T. Aste, "When Can Social Media Lead Financial Markets," Scientific Reports, 2014.

[11]. M. G. Sousa, K. Sakiyama, L. S. Rodrigues, P. H. Moraes, E. R. Fernandes and E. T. Matsubara, "BERT for Stock Market Sentiment Analysis," International Conference on Tools with Artificial Intelligence, New Delhi, 2019.

[12]. Y. Kim, S. R. Jeong and I. Ghani, "Text Opinion Mining to Analyze News for Stock Market Prediction," Kookmin University, Seoul, 2014.

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