Does mood affect prediction performance? When analysts are in a positive (negative) mood, do they make more positively (negatively) biased and less (more) accurate forecasts? This study provides supportive evidence. Specifically, we find that analyst forecasts are more optimistic and have larger errors near holidays, but more pessimistic and have smaller errors when there is a disaster with significant fatalities. We further show that these results are neither driven by sentiment associated with contemporaneous economic or market conditions, nor by under-reaction or over-reaction to more bad news released on days immediately before weekends or holidays.
https://acfr.aut.ac.nz/conferences-and-events/past-conferences-and-events/auckland-finance-meeting2/2016/academic-programme, 2016, pp. 1 - 78