 | February 1, 2010 - 'Weighted Composite Index' Continues Recovery:
During the week leading up to February 1st our 'Weighted Composite Index' trended slightly up while staying at or very near positive economic growth. During the same period the measure of our trailing 'quarter' (our proxy for a real-time 'GDP') continued to decline slightly to an annualized contraction rate of 0.65%. The -0.65% 'growth' kept the trailing 'quarter' in the 17th percentile among all GDP quarterly growth figures recorded since the spring of 1947.
Our 183-day 'two quarters' growth index slipped slightly to 2.13% net growth, and the trailing 'year' dropped to 2.37% net growth. Both of those ogrowth rates placed those periods near the lowest third among all similar length periods in the 1947-to-date table. Although these numbers are down sharply from recent highs recorded in November, at least they show modest growth and are a far cry from the lows of -4.61% and -1.94% annualized 'growth' recorded respectively in November and December 2008.
The Automotive Index continued strong, with all of the sub-indexes (except European Autos) turning up over the past few weeks. The Domestic Autos Sub-Index (chart on left below) shows this trend, with the sub-index crossing into positive territory once again after suffering through withdrawal pains in the aftermath of the 'Cash for Clunkers' bubble that is clearly visible in the chart. The Technology, Health and Household Indexes remain strong, as does the Travel Index.
Our Financial Index has been our most volatile sector over the past several weeks, climbing to over 110 on January 21st before dropping back down into the neutral zone by February 1st. And the Retail Sector continues to be weak, at least for major discretionary purchases of durable goods. The Home Improvement Stores Sub-Index (chart on right below) exemplifies that weakness, with lots of volatility and no recent multi-month trends.
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