Increasing Global Violence and Aggression: Outlook 30 December '13

after market update: actual S&P -0.33   The attacks in Russia and Iraq over the weekend demonstrate the surge in violent mood.  Will this trend continue?   Markets were relatively unchanged once again, in line with the news themes signal of +0.3.  The divergence between social mood and markets is still high, although the gap was narrowed slightly today.

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Overview: Collective mood shows increasing aggression and violence globally.  Increasing global risk for natural destructive events, especially volcanoes and fires. Mood signals for the day indicate a market rally, but markets are highly overbought relative to social mood.

 

Today's Signals: +20.8 from Google Hot Trends, +0.3 from Themes in the News.  The projected stock market change for today is shown in the chart below.

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Mood signal from Google Hot Trends: On a daily basis, markets tend to follow social mood more often than not.  Overall, social mood trend changes often precede market trend changes.

 

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Mood signal from themes in the news: News tends to follow the general trend of the market, but on a daily basis, can either lead or lag the movement of the market.    

 

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Note: data for U.S. social mood are scores in eight MoodCompass categories of Google Hot Trends, data for news are scores of top Google U.S. news stories.  Scores are converted to 4 inputs to the Market Mood Model.  The output is a conversion of mood data to estimated S&P point change.  Stock market data source: Google Finance.  This is posted as a public service, and to enhance exposure to our research.  It is not intended to be trading advice.