Forthcoming Articles http://jjll.ruc.edu.cn EN-US http://jjll.ruc.edu.cn/EN/current.shtml http://jjll.ruc.edu.cn 5 This paper utilizes negative words顒� proportion in country顎憌ide financial newspapers to construct the media pessimism index, which measures the media sentiment顎怶e combine the media pessimism index with the panel of earning announcement events during period 2004—2013 to empirically test the effects of the media sentiment on the earning announcement abnormal returns, through which the question on whether investors unbiasedly react to earning information is answered顎怲he empirical results show: (1)For earning announcements containing the same information, the higher the media pessimism, the lower the announcement abnormal returns顎�(2) The market顒媠 reaction of bad news is more pronounced during pessimistic periods顎怬n the other hand, the market顒媠 reaction of good news is more pronounced during optimistic periods顎�(3) The effects of media sentiment are more pronounced for bad news than good news顎怲he results indicate that the media sentiment effect has an essential impact on the investors顒� interpretation of earning information, and the effect is closely related to the message type.

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