Reuters To Launch Algorithmic News Sentiment Tool; Acquires Israeli Digital Text Solutions Developer

Reuters Group PLC plans to launch a computer application Monday that scans news articles to measure whether companies are receiving positive or negative news coverage, a tool that can be used to trigger stock trade ideas. The program, offered to Reuters clients at hedge funds and trading desks, will initially integrate just Reuters's own news service, but eventually will include news sentiment from other services as well. In addition to tracking individual company names, the program can track news sentiment in entire industries or exchanges, which can be applied via ETF trading. Reuters will charge between $200,000 to more than $1 million for the new product, depending on the size of the firm and how customized a particular firm wants it to be. In related news, Israeli business daily Globes reports Reuters has acquired Israeli digital text analysis solutions developer ClearForest Ltd. for about $30 million. ClearForest's CTO, Dr. Yonatan Aumann is the son of Nobel Prize for Economics Laureate Prof. Israel Aumann, and helped found the company in 1998.

Sources: Press Release, Wall Street Journal, Globes
Commentary: Reuters, CME Team Up To Open Spot Currency Exchange • Reuters Group: ValueAct Capital Raises Stake
Stocks/ETFs to watch: Reuters Group PLC (RTRSY). Competitors: Dow Jones & Company Inc. (DJ), THOMSON CORP (TOC), Track Data Corp. (TRAC), Interactive Data Corp. (IDC), Morningstar Inc. (MORN)

Seeking Alpha's news briefs are combined into a pre-market summary called Wall Street Breakfast. Get Wall Street Breakfast by email -- it's free and takes only seconds to sign up.