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How candidate tweets impact the stock market

Netvibes election dashboard

Last week Mylan, maker of the EpiPen medical device, came under fire in the media for skyrocketing prices. The cost of a pair of EpiPens in 2016 now exceeds $600–a more than 500% price increase since 2009. EpiPens cost only a few dollars to make and can be life-saving emergency devices for people with food allergies.

On August 24, the day the EpiPen news cycle began, presidential candidate Hillary Clinton weighed in from her Twitter account, tweeting:

“EpiPens can be the difference between life and death. There’s no justification for these price hikes. http://hrc.io/2c7lhrs  -H”

https://twitter.com/HillaryClinton/status/768508732623970304

On that day Mylan’s stock fell by 5%. Biotech stocks overall also took a hit, falling 3% (as measured by Nasdaq Biotechnology Index).  It’s now one week later, and stock prices have not yet recovered.

Because the media has pointed to Clinton’s tweet as a cause of the market downturn, we decided to take a look at the data in the 2016 Netvibes Election Dashboard to see if we could identify a correlation. Can candidate tweets really impact the stock market? It seems that yes, in certain cases they can.

 

Clinton vs. the Stock Market

  1. Mylan

When we look at Mylan’s stock, there’s a clear downturn after Hillary’s tweet was posted.

Netvibes election dashboard

  1. NASDAQ Biotechnology Index (NBI)

We found a similar effect in September 2015, when a drug called Daraprim skyrocketed to $750/pill from $13.50 overnight. On September 21, Clinton tweeted:

“Price gouging like this in the specialty drug market is outrageous. Tomorrow I’ll lay out a plan to take it on. -H”

https://twitter.com/hillaryclinton/status/645974772275408896?lang=en

In the days following, biotech stocks tumbled.

Netvibes election dashboard

Trump vs. the Stock Market

We wondered if we could find a similar trend with Clinton’s opponent, Donald Trump. Trump has posted many controversial tweets throughout the campaign, but we couldn’t find any impact on related stocks. For example:

  1. Apple

On February 19, Trump called for a boycott on Apple products, tweeting:

“Boycott all Apple products  until such time as Apple gives cellphone info to authorities regarding radical Islamic terrorist couple from Cal”

https://twitter.com/realdonaldtrump/status/700796528844103680

But when we look at the stock prices, Apple’s stock just kept going up following Trump’s boycott.

Netvibes election dashboard

  1. Smith & Wesson

On June 13, the day following the terrorist shooting in Orlando, Trump told CNN:

“”If you had guns in that room … you wouldn’t have had this same kind of a tragedy”

CNN tweet: https://twitter.com/cnnpolitics/status/742333668132323328

Trump’s statement was immediately shared and debated across Twitter. Did it impact gun stocks, such as Smith & Wesson? Apparently not. SWHC stock actually declined slightly from June 12-14, before beginning its rise that continues today.

Netvibes election dashboard

Clinton vs. Trump tweets: What’s the difference?

Why have Clinton’s tweets sent biotech stocks tumbling, while Trump’s tweets seem to have no effect? It’s hard to say, but one possibility is that because Clinton is the odds-on favorite to win the election, the market takes her more seriously. The 538 blog currently gives Clinton a 73.8% chance of winning. If you have an alternate theory, please share it with us in the comments.

You can explore all these charts on the “Election & Stocks” tab on the Netvibes Election Dashboard. Stay tuned to the blog, where we’ll keep sharing dashboard insights leading up the the November 8 election.

Want to learn more about Netvibes dashboards? Contact us for a free demo.

 

Disclaimer

Written by Kim Terca of Netvibes. Any opinions expressed are my own, not my employer’s.

Analytics are based on a wide variety of online sources collected by the Netvibes dashboard, including news publications, blogs, videos and social media. To see all sources, please visit the Dashboard Tab titled “Sources.” Candidate polling data is sourced from The Huffington Post.

Netvibes’ Election dashboard is meant to provide a neutral analysis of available election data. It should not be considered an official statement by Netvibes, Inc. or Dassault Systèmes.

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