LLM-Based Financial Sentiment Analysis in Arabic: Evidence from Saudi Markets

English financial NLP has advanced rapidly through benchmarks targeting earnings analysis, market sentiment, tabular reasoning, and financial question answering, yet Arabic financial NLP remains virtually nonexistent, despite 422 million speakers, $4.9 trillion in Gulf sovereign wealth, and a$4-5 trillion Islamic finance industry requiring specialized Shari'ah compliance over instruments like sukuk, murabaha, and takaful. We introduce Sahm, the first Arabic financial benchmark spanning seven tasks: AAOIFI standards QA, fatwa-based QA/MCQ, accounting and business exams, financial sentiment analysis, extractive summarization, and event-cause reasoning, comprising 14,380 expert-verified instances from authentic regulatory, juristic, and corporate sources. Evaluating 20 LLMs, we find Arabic fluency does not imply financial reasoning: models achieving 91% on recognition tasks drop sharply on generation, and event-cause reasoning exposes the widest performance gap (1.89-9.84/10). We release the benchmark and dataset to support trustworthy Arabic financial assistants.

Financial sentiment analysis converts unstructured financial news into quantitative signals that can support market analysis and decision-making. Existing work on resource-efficient financial NLP has largely focused on compressing or adapting pretrained language models, with less attention to combining contextual representations with lightweight rule-derived features. This study develops Rule-Aware FinBERT (RA-FinBERT), a parameter-efficient framework that integrates low-rank adaptation (LoRA) with three continuous VADER-derived sentiment proportions (positive, negative, and neutral) and a source-level metadata feature. The standardized four-dimensional feature vector is directly concatenated with the 768-dimensional final-layer FinBERT [CLS] representation and passed through a lightweight classification head. This design introduces only 1,024 additional trainable weights relative to a structurally matched text-only FinBERT model. RA-FinBERT was evaluated against text-only FinBERT and a lightweight DistilBERT baseline for three-class sentiment classification of financial-news titles and descriptions. On the held-out test set, RA-FinBERT achieved 69.89% accuracy and a macro F1 score of 0.634, compared with 63.44% and 0.526 for text-only FinBERT. Neutral-class recall increased from 18.18% to 45.45%. The framework supports both CPU and GPU execution, offering a lightweight and practical approach to financial sentiment classification under constrained computational resources. These findings indicate that rule-derived sentiment information and source metadata can provide complementary signals to contextual FinBERT representations and improve performance with minimal additional model complexity.

Recent advances in Generative AI have substantially improved financial sentiment analysis through post-trained financial large language models (LLMs). However, existing approaches remain confined to a market-agnostic, supervised learning paradigm that relies on limited, static and human-annotated datasets, and thus are incapable of adapting to evolving market conditions. To address this limitation, we introduce FinSMART, the first market-aligned reinforcement learning framework for financial sentiment analysis, which directly optimizes sentiment signals using realized market outcomes. To deal with the noisy, non-stationary, and multifactorial nature of financial markets, FinSMART incorporates a signal extraction pipeline that combines market-aware data filtering with a discrete asymmetric trading reward, enabling stable reinforcement learning from economically meaningful market feedback. Experimental results demonstrate that FinSMART significantly outperforms existing state-of-the-art methods in profitability, risk-adjusted performance, and sentiment signal quality, improving cumulative trading returns by 220% over the strongest baseline. Uniquely, the FinSMART framework naturally supports market-aware retraining, at any point in time, by replacing costly manual annotation with newly observed financial articles and their realized market outcomes. Such a retraining strategy enables the model to continuously adapt to changing market dynamics, resulting in consistent performance gains over its static counterpart. These findings demonstrate the practical applicability of market-aligned reinforcement learning and highlight its potential as a next-generation paradigm for developing adaptive financial LLMs.