Whether you like it or not the financial media effects the stock market. This is plainly obvious for anyone who observes what happens to stocks mentioned by Jim Cramer on his nightly program Mad Money. Many sophisticated investors despise his show, but if he spends 10 minutes discussing a stock it will move the next day. What we have termed the “Cramer effect” is most noticeable in small stocks, but even large caps occasionally behave abnormally after Cramer gives them attention. A specific example comes from a little while ago Cramer discussed his bullish stance on mega-mining stock Freeport McMoran (FCX). He devoted a few minutes of his show and the stock ran up 11% the next day with no other news of significance.*
At Ockham, we often write about Cramer not because we think he is a genius, but rather we appreciate the fact that the media moves stocks. It is for this reason that we developed RazorWire as an attempt to quantify the amount of news flow about an individual company. In the last thirty days, we have captured at least one mention on business television or influential blogs for more than 1200 stocks. Today’s screen identifies the top 1% of stocks discussed on RazorWire.
Most active RazorWire stocks in past 30 days:
- Goldman Sachs (GS)
- Apple (AAPL)
- Citigroup (C)
- JP Morgan (JPM)
- Google (GOOG)
- Intel (INTC)
- Bank of America (BAC)
- Alcoa (AA)
- Microsoft (MSFT)
- Morgan Stanley (MS)
- BP Plc (BP)
- American International Group (AIG)
There are not many surprises in this group as they are mostly financial and technology stocks. We would have guessed the top spot would be occupied by Goldman with their recent controversy. Also, BP is an obvious headline grabber with the so much news surrounding the leaking deepwater oil rig. Alcoa was the lone surprise, as far as we are concerned. It is a Dow component and they are always a highly anticipated earnings report, but eighth was higher than we expected.
*In the process of writing this, Cramer was given credit for moving the market once again. For a great example of the media moving stocks, see this clip. (H/t to The Business Insider)
