Before you react: read the whole picture.

A market headline is a starting point. Understanding it means looking at what was measured, when, and against which comparison.

1. Which market are we talking about?

A broad index, a single company, a sector, and a currency can tell different stories. An index tracks a defined group of securities. A move in that group doesn’t describe every business or every household’s experience. The SEC’s index explainer is a useful place to start.

2. When was the number measured?

Check the event date as well as the publication date. Then look for the time of the observation. A previous closing price and a figure measured during the trading day are different snapshots.

Before sharing a screenshot, make sure the date and original context have come along with it.

3. Compared with what?

A percentage needs a starting point. A one-day change, a year-to-date change, and a move from a recent high answer different questions. Look for the timeframe before deciding what the number tells you.

4. What does the evidence establish?

Separate the observed move from an explanation for it. Two events happening close together doesn’t, on its own, prove that one caused the other. Look for evidence behind the explanation and for uncertainty the headline may leave out.

5. Where is the original source?

Follow the claim back to the underlying data, company filing, announcement, or full report. Read enough of it to see whether the headline matches the evidence.