We examine how the sudden drop in public information search capability caused by Google’s withdrawal from China affects Chinese analysts’ earnings forecasts. We observe, after Google’s withdrawal, a decline in analysts’ forecast accuracy for firms with foreign trade relative to those without it. This decline suggests that the withdrawal hinders analysts’ acquisition of foreign information about firms, which decreases the quality of their earnings forecasts. We also find that the effect of the withdrawal on forecast accuracy is stronger for firms with higher business complexity and more opaque financial reporting and for analysts with weaker information processing capacity and more attention constraints. Additionally, we find that corporate site visits serve as an alternative information source that can compensate for the information loss caused by the Google withdrawal. Last, we document that the withdrawal reduces analysts’ forecast timeliness and increases their forecast dispersion.

This paper decomposes news-implied linkages into two types: leader-follower links (LF) and peer links (PE), based on people's reading and information-processing habits. We explore how the structure of information impacts processing costs and subsequently leads to market outcomes by examining momentum spillover effects via these distinct linkage types. Our findings indicate that the information structure of leader-follower links is more readily comprehensible to investors than peer linkages. We provide empirical evidence of this by demonstrating faster attention spillover from leader to follower than among peer firms, using Baidu search data. Furthermore, we document that due to the lower information processing cost, information transmits through the leader-follower linkages more quickly, leading to a weaker momentum spillover effect compared to the more complex and less easily perceivable peer links.