Home Add to Favorite Contact Submit  
           20 September, 2019

Category:  Press » Finances


Dow Jones Economic Sentiment Indicator Rebounds; Rises to 36.9, Highest Level Since August 2008

         Views: 1306
2009-11-03 04:07:57     
Dow Jones & Company

The Dow Jones Economic Sentiment Indicator (ESI) rose to 36.9 in October, up from 34.1 in September as a result of positive media coverage of ongoing stock market gains and news that the gross domestic product rose at an annual rate of 3.5 percent in the third quarter. The gain in the ESI runs counter to unexpectedly large drops in two leading consumer-based economic indicators.

The Dow Jones Economic Sentiment Indicator aims to predict the health of the U.S. economy by analyzing the coverage of 15 major daily newspapers in the U.S. The two leading consumer-based economic indicators, the University of Michigan Consumer Sentiment Index and the Conference Board's Consumer Confidence Index, use national surveys to measure consumer attitudes about the state of the U.S. economy. The Consumer Confidence Index dropped dramatically to 47.7 in October, its second consecutive monthly decline. The Consumer Sentiment Index fell to 69.4 in October after having posted an unexpectedly strong rise in September.

According to Dow Jones Newswires 'Money Talks' columnist Alen Mattich, the divergence in the indicators can be explained by the difference in how the media and consumers view economic news. "Consumers are likely to focus on the continuing bad employment news because of the fear that they could be next," Mattich said. "On the other hand, there was a drop off in coverage of the recession as the media focus on broader positive economic trends such as the stock market's rebound, improved corporate earnings and the growth in the GDP outweighed coverage of mixed or negative news during the month."

The ESI has risen 10 out of 12 months since its low of 22.2 in November 2008, data that confirm the consensus among economists that the U.S. recession ended sometime early in the summer.

"The ESI's strong rise since its lows in November 2008 shows the U.S. economy is clearly getting better, a message confirmed by the big jump in third-quarter GDP," Mattich said. "But the ESI's relatively low level suggests the recovery remains vulnerable to reversal. In the past two cycles, an economic upturn wasn't firmly established until the ESI reached the upper 30s or lower 40s."

Mattich points out that a gain in the ESI historically indicates improvement in the labor market, but significant improvement may still be months away. "In past economic recoveries, increases in the ESI have lead improvements in non-farm payroll by two to five months and improvement in the unemployment rate by five to seven months," Mattich said.

The ESI represents one of the most comprehensive and far-reaching examinations of media coverage as an economic indicator. The ESI's back-testing to 1990 shows that the ESI clearly highlighted the risk that the U.S. economy was sliding into recession in 2001 and 2008 and suggests the indicator can help predict economic turning points as much as seven months in advance of other indicators.

Unlike some other indicators where 50 is a clear break-point between recession and recovery, the ESI needs to be read with reference to longer trends. Based on the ESI's performance since 1990, previous recoveries have been marked by substantial month-to-month gains, with a jump of three points seeming to be a sign of significant improvement. A drop below 50 marks the point at which there is a clear risk of a slowdown.

The Dow Jones Economic Sentiment Indicator is calculated using a proprietary algorithm through Dow Jones Insight, a media tracking and analysis tool.

Dow Jones Insight uses innovative text mining and analytic technologies to help organizations keep informed about relevant issues, news, conversations and trends emerging in mainstream, Web and social media. Dow Jones Insight's global content collection includes more than 25,000 news and information sources as well as blogs, message boards, and posts from YouTube and Twitter.

About Dow Jones

Dow Jones & Company is a News Corporation company.Dow Jones is a leading provider of global business news and information services. Its Consumer Media Group publishes The Wall Street Journal, Barron's, MarketWatch and the Far Eastern Economic Review. Its Enterprise Media Group includes; Dow Jones Business & Relationship Intelligence, Dow Jones Newswires, Dow Jones Factiva, Dow Jones Client Solutions, Dow Jones Indexes and Dow Jones Financial Information Services. Its Local Media Group operates community-based information franchises. Dow Jones owns 50 percent of SmartMoney and 33 percent of STOXX Ltd. and provides news content to radio stations in the U.S.

The Dow Jones Economic Sentiment Indicator is provided for analysis purposes only and Dow Jones makes no representation that the indicator is a definitive predictor of sentiment or the health of the U.S. economy. This report does not in any way reflect an opinion of Dow Jones regarding the U.S. economy or the suitability of any investments.

Specialized in: Dow Jones - Economic Sentiment - Indicator Rebounds - Rises
URL: http://solutions.dowjones.com
Print press release      Bookmark this page
Related Press releases 
California Cannabis Insurance Company Explains Marijuana Surety Bonds (Popularity: ): Los Angeles, California ( press.abc-directory.com ) May 20, 2019 - MFE Insurance, a California cannabis insurance company, recently released a blog discussing the use of surety bonds for marijuana dispensaries. While there is no single surety bond available for the industry on a national basis, states require medical and recreational dispensaries to carry various types of bonds before they can begin operation.Surety bonds provide a financial guarantee that the bond ...
E&O Insurance Policies Explained By Fairfax Health Insurance Brokers (Popularity: ): Fairfax, Virginia ( press.abc-directory.com ) February 27, 2019 - The Fairfax health insurance brokers at BBG Broker recently published a blog explaining the purpose of E&O insurance policies and why certain businesses should carry it. Certain industries require it, but it may be beneficial even for those that do not.E&O, or errors and omissions insurance, is a type of professional liability insurance. It protects companies and their employees against claims ...
LA Specialty Insurance Agency Discusses Dram Shop Liability Insurance (Popularity: ): Los Angeles, California ( press.abc-directory.com ) February 5, 2019 - MFE Insurance, a Los Angeles specialty insurance agency, recently released a blog educating readers on the benefits of dram shop liability insurance. Having this type of insurance can protect establishments from costly legal expenses and prevent financial issues.Dram shop laws in 38 states stipulate that a business that sells alcoholic drinks or a host who gives liquor to a person ...
FAAIF Announces Introduction to Sukuk Two-Day Workshop at Sofitel Hotel in New York City October 11-12, 2014 (Popularity: ): New York, September 20, 2014 -- Camille Paldi, CEO of FAAIF, is excited to bring training in the sukuk structure to an American audience. Paldi says the time is now for the USA to enter the sukuk market as the UK has just issued a 200 million pound sukuk, bringing in funds for the UK government and businesses. Paldi emphasizes that the USA may get left behind if it does ...
Beverly Loan Company Partnering to Make Loans Against Motor Vehicles (Popularity: ): Beverly Hills, CA - June 27, 2014 -- Beverly Loan Company, often coined as the "Pawnshop to the Stars," has announced a new partnership that will allow its clients to receive VIP treatment from the industry leader in pawn loans and title loans against cars, trucks, motorcycles, and boats. Since 1938 Beverly Loan Company has been the premiere collateral lender for gold and platinum jewelry, diamonds and colored stones, fine ...

Press release home snapshot 

Related Business 
Dow Jones Futures Index (Popularity: ): Techniques and methods for Dow Jones futures trading. Trading can be risky and if you want to expand your knowledge before Dow trading, check here for information on Dow day trading, Dow futures market, Dow Jones Index and Dow futures options.
Dogs of the Dow (Popularity: ): A free stock market newsletter and website devoted to selecting high dividend yield, blue chip stocks that have historically outperformed the Dow Jones Industrial Average.
Dow: Our Family Treasury (Part 3) (Popularity: ): Selected transcripts from The Book of Dow featuring the descendants of Henry Dow (b.1637) and Thomas Dow (b.1639). Includes the lineages of New Brunswick, County York and Carleton.
Conference Board - Consumer Research Center (Popularity: ): Gives consumer marketers and economic observes a report of US consumer sentiment about conditions, and indicators of impending economic downturns or recoveries.
Chirag Electronics: Polariscope Meter Manufacturers (Popularity: ): Chirag Electronics is a well-reckoned Manufacturer and Supplier of Electrical Control Panels, Automatic Water Level Controller, Hot Runner Temperature Controller, Automatic Light Control Switch, Polariscope Meter, Ultrasonic Level Indicator, Ultrasonic Level Transmitter and Valve Position Indicator. All our offered products are highly appreciated for their robust construction, precision engineering and cost-effectiveness. They are known for their numerous industrial applications.
Dow Jones (Popularity: ): Parody site created by RTMark that focuses on the Bhopal controversy.
Dow Theory Forecasts (Popularity: ): A weekly stock recommendation and rating newsletter. Ranked #2 among all investment newsletters in the July/August 1999 issue of Worth magazine.
Manufacturers of Refrigeration valves (Popularity: ): Superfreeze is manufactures of Refrigeration valves, Ammonia compressor, Refrigeration control valves, Refrigeration compressor, Ammonia Evaporators, Ammonia valves, Refrigeration controls, Liquid level controller, liquid level indicator, Float valve, Float switch, Solenoid valves, Check valves, cold storage, cooling equipment, Expansion valves, ice machinery, Ice plants, Safety relief valves, Shut off valves, temperature indicator in India.
Factiva, a Dow Jones & Reuters Company (Popularity: ): Offering business content management and integration services containing business news and information.
OTC BB Pulse (Popularity: ): Offers tools: PulseQuote (with delayed Level II and more), Trading Sentiment, Exceptional Volume Leaders, and OTCCD Matrix.