“Noon Sunshine-Young Scholars Seminar” is a regular academic exchange platform held by School of Finance. It aims to offer valuable occasions of communications among scholars in our college, between teachers and students, the domestic and the oversea. In this semester, we keep our original intention, set off for a new voyage. We will devote ourselves to fostering the academic atmosphere in the college, and promoting the academic level for both teachers and students.

The eighth session of “Noon Sunshine-Young Scholars Seminar” for the Autumn Semester in 2025 is arranged as follows:

Lecture topic

Extrapolation and Market Reactions to News 

Keynote Speaker: Tian Jiaxing

Date

Thursday, November 6th, 2025

Time

12:00-13:30

Lecture Venue 

Room 116, School of Finance

Abstract

We document a novel news extrapolation behavior among investors, which distorts the market reaction to corporate news. Specifically, investors tend to extrapolate the value of past news in the immediate reaction to the newly arrived news. News extrapolation generates a biased price reaction to news, which is completely reversed afterwards. Furthermore, the tendency of news extrapolation is related to the recency, consistency, and value uncertainty of news. Investors extrapolate not only from news of the same category but also from news of different categories. By analyzing the trading behavior and sentiment of different investor groups, we find that retail investors tend to be news extrapolators, while institutional investors trade against the news extrapolators.