Dow Jones Today Economic Sentiment Indicator Drops in September 2010
Following 4 months of modest but regular positive factors, the Dow Jones Financial Indicator (ESI) fell to 40.7 in September, down from 43.2 in August and its largest one- month drop since October 2008. And while the Indicator has historically declined in September, there are indicators that the economic recovery is faltering with a sharp enhance in negative financial stories over the last seven days of the month.
"It may very well be the decline merely reflects a seasonal impact as a result of on balance over the previous twenty years the ESI has tended to dip throughout September," Dow Jones Newswires "Money Talks" Columnist Alen Mattich said.
Mattich factors out, nevertheless, "A weekly analysis of the ESI showed significantly sharp erosion in the Indicator during the past seven days. Had been this pattern to proceed over the coming weeks, it might signal a sharply growing danger of a double dip for the U.S. economy."
The ESI is determined by in-depth evaluation of nationwide information coverage across 15 each day newspapers.
Among the many negative tales within the media during the month had been an article charting the cost to the Boston economy of the Red Sox failing to make the playoffs; shortcomings in Obama's flagship mortgage-reduction program; the monetary issues of the Washington Nationwide Opera; and coverage of census figures that present more single couples live together maybe because of harsher economic conditions.
The Dow Jones Economic Sentiment Indicator goals to predict the health of the U.S. economic system by analyzing the coverage of 15 main every day newspapers within the U.S. Utilizing a proprietary algorithm and derived knowledge know-how, the ESI examines every article in every of the newspapers for constructive and negative sentiment concerning the economy. The indicator is calculated by Dow Jones Perception, a media monitoring and evaluation tool. The expertise used for the ESI additionally powers Dow Jones Lexicon, a proprietary dictionary that enables traders and analysts to find out sentiment, frequency and other relevant complicated patterns inside news to develop predictive trading strategies.
The ESI's back-testing to 1990 reveals that the ESI clearly highlighted the danger that the U.S. economy was sliding into recession in 2001 and 2008 and suggests the indicator can assist predict financial turning points as much as seven months in advance of different indicators.
Dow Jones Insight uses revolutionary textual content mining and analytic technologies to assist organizations keep informed about related issues, news, conversations and developments rising in mainstream, Internet and social media. Dow Jones Insight's international content material collection consists of greater than 25,000 information and knowledge sources as well as blogs, message boards, and posts from YouTube and Twitter.
About Dow Jones Today
Dow Jones & Company is a Information Corporation company (Nasdaq: NWS, NWSA; ASX: NWS, NWSLV) and a leading provider of world information and enterprise information. Its principal merchandise embody The Wall Avenue Journal, Dow Jones Newswires, Dow Jones Factiva, Barron's and MarketWatch. By way of its Local Media Group, Dow Jones operates group-based newspapers and Internet sites. Dow Jones also provides news content material to television and radio stations.
The Dow Jones Economic Sentiment Indicator is supplied for evaluation functions only and Dow Jones makes no illustration that the indicator is a definitive predictor of sentiment or the health of the U.S. economy. This report does not in any means mirror an opinion of Dow Jones relating to the U.S. economic system or the suitability of any investments.
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