Leading Indicators : November 8 to 12

Twenty of the twenty-two stockmarkets indexes most followed by analysts around the world were down last Friday compared to the previous Friday. It seems that markets reacted to an expected downturn in China and the return of last summer worries related to the financial and economic situation in many european countries. Commodity spot prices were also on the downside. Is it just a pause or the start of a correction after the important increases in market values since early September? Remember that stockmarkets and many commodities, especially copper and aluminum, are proven leading indicators. 

On November 8, the OECD published its leading indicator indices. The most recent results are based on September data. Its press release puts the emphasis on the "diverging growth patterns in major economies". Countries like China and India send signals of a slowdown. It might not be a bad thing taking into account the recent increases in consumer prices in those countries. For the OECD as a whole, the pronostic is "steady growth". 

The Conference Board published its leading and coincident economic indexes for three countries. The outlook is to a downturn in the United Kingdom and South Korea. For Japan, the CB indexes point towards a slow growth, contrary to the OECD leading index which suggests an expansion.

The weekly leading index for the United States developed by the Economic Cycle Research Institute increased at the end of October and early November; on November 5, it was at its highest level (123,9) since May 21 (125,3).

Consumer Confidence indexes were published for the UK and Japan. In both, the downward trend continued in October.

In Canada, CMHC data on housing starts showed that the residential building industry will not support the economic growth in the coming months. In October, housing starts decreased for a third month in a row.

This week, leading economic indexes will be published for China, the United States and Canada. The semi-annual OECD economic outlook will come out on November 18.