When in August Thomson Financial developed (FT) a computer algorithm that automatically generated financial news, I noted (Journalism.co.uk) that the weak link in that trading chain was now the equity trader at the bank's end. And I predicted that soon we'd see systems developed that automated not only the writing of the news but also the execution of trades based upon it. Today, Reuters launches two products that offer that very service.
Newscope Real-time "lets Reuters clients use Reuters live news content to drive automated trading and respond to market-moving events as they occur. Each news item is “meta tagged” electronically to identify sectors, individual companies, stories or specific items of data to assist automated trading."
If you don't need anything as slow and expensive as people to write the news, the last thing you want is slow, expensive people to interpret it. That said, the caveat remains the same - GAAP and Sarbanes-Oxley have made reporting a lot more formulaic, but there's still nuances and pro forma events that will make a nonsense of many trades executed automatically on the basis of the official figures.