Indicator Series Vol. 9 : Transports

As a bellwether indicator for economic health, the transportation sector of the equity market tends to foresee a downturn coming. When the transports start under performing the market as a whole, it is seen as a negative. This is likely because the shipping of intermediate and finished goods has dropped off and there is less overall demand being seen on the front lines of business.

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As you can easily see, since the US election transports are hurting.They are under performing the S&P 500 by over 15%. This is surely not a good sign. Keeping an eye on this divergence would be wise.

 

Source: WSJ Daily Shot 11.13.17

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