LSE lays high-stakes $27bn bet that data is the future; AI/share trading: earnings call bingo


• Brussels had quashed its high-profile merger with Deutsche Börse, and Brexit threatened London’s role in global finance.
• The LSE on Friday confirmed a FT report that it was talks to buy data and trading venue group Refinitiv for $27bn including debt. If an agreement is reached, it would transform the LSE into a provider of financial market infrastructure and data with the scale to take on titans like Bloomberg’s empire.
• “There is a wider market concern about exchanges and data vendors combining,” said Niki Beattie, founder of Market Structure Partners. “The global world of data distribution is presided over by a small number of players who have a lot of power.”


• In theory, a computer should be able to pick up clues to profits performance by screening screeds of verbiage. For the theory to work, the AI program needs some linguistic ability to interpret words in context.
• We also screened Coca-Cola’s first-quarter calls. Words such as “price”, “mix” and “volume” were used frequently last year. This year, “currency” and “markets” abounded. A jump in the use of “innovation” stood out. Might the business fear its sugary drinks are going out of fashion?
• More scientifically, Goldman Sachs screened 4,000 earnings calls from S&P 500 companies over the past year. The results paint a starkly different picture to the one portrayed by stock prices near record highs. Goldman’s index of earnings call sentiment was at its lowest level in June. Concerns over slowing growth were high. Goldman found a “significant relationship” between the mood of earnings calls and subsequent stock price movements.