Leading Wall Street Economic Indicators
Well-timed news from the financial market is key to producing wise investment decisions. IBD and The WSJ are the some of the news sources to go to for this timely information. When you track their reliable metrics and heed the targeted insights about economic trends and market forces, you gain an advantage.
Leading indicators of the economy change prior to actual economic changes. These indicators are the consumer price index reports, the consumer confidence index, the gross domestic product reports, the retail sales index, the employment cost index, the national association of purchasing management index, the productivity report, the productivity report, the producer price index, employment indicators and durable goods order are the indicators which display how much output a unit of labor creates.
How both can impact your everyday finances and personal investments is a matter of systematic review and then taking action. One of the major telltale signs of economic direction is consumer confidence and is published in the Wall Street Journal and other leading financial papers. It is one of the first signs that the current economic downturn is waning.
Consumer confidence numbers belong to a special group of statistics that are known as ‘leading indicators’. They can show trends in the economy several weeks before they become apparent by harder objective data.
Consumer confidence numbers are arrived at through interviews with a random sample of consumers. These random selections are geared as a relative representative of attitudes and population structure of the country as a whole. Data point answers are weighted according to different income groups, occupations, and regions.
Many believe that solid consumer confidence is crucial to the growth of the economy. This data is revealed at 10:00 a.m. EST on the last Tuesday of any given month. The report analyzes how confident consumers feel about the economy and now willing they are to spend.
The stock market is historically the prime leading indicator of the direction of the economic condition. It usually leads the real economy by about half a year.
This being said, even in a downturn, there can be fake out’s or dead cat bounces before a market resumes a downward plunge. Or, in a raising market, there can be sudden plunge that leaves a lot of investors scratching their heads as to why the markets behave that way. Financial and psychological damage will leave opportunities to enter markets for those who study the financial news. Get a Wall Street Journal subscription and read about CPI news as it happens.