"Buy the rumour, sell the news" is a trading saying that describes a common price pattern around expected events. An asset rises as traders anticipate good news, such as strong earnings, a regulatory approval or an interest rate cut. When the news is confirmed, the price stops rising or falls, because those who bought early take profits and few new buyers remain.
The logic follows from the efficient market hypothesis: prices reflect expectations, so only the unexpected part of an announcement should move them. An outcome that matches what was priced in leaves nothing to gain. The saying is a description, not a dependable rule. Rumours are often wrong, the timing of the turn is unclear, and results that beat expectations can push prices further, as in post-earnings announcement drift. The pattern is studied in news-based trading and sentiment trading. Trading on confidential information ahead of an announcement is insider trading and is illegal.