Bellwether

Source: Wikipedia, the free encyclopedia.

A bellwether is a

leader or an indicator of trends.[1]

In

microcosm those of a wider area, such that the result of an election in the former region might predict the eventual result in the latter. In economics, a 'bellwether' is a leading indicator of an economic trend.[1][2]

trends
.

Etymology

A bellwether sheep, with a bell around its neck

The term derives from the

bell around the neck of the lead wether (the male sheep). A shepherd could then note the movements of the animals by hearing the bell, even when the flock was not in sight.[3]

The word was first used in the above meaning in the 15th century.[3]

In economics

In the world of economics and finance, a 'bellwether' is a leading indicator of an economic trend.[1][2]

In the stock market, a 'bellwether' is a company or stock taken to be a leading indicator of the direction in a sector, in an industry or in the market as a whole. Bellwether stocks therefore serve as short-term guides. JPMorgan Chase is a U.S. example of a bellwether. As one of the major banks in the United States, its stock sets the tone for the rest of the banking industry. JPMorgan Chase also has contracts with companies in other industries, so its performance is reflected in other sectors of the market. Tata Consultancy Services is similarly a bellwether for technology stocks in the Indian markets, BSE and NSE.[2]

Similarly, a bellwether bond is "a government bond whose changes in interest rate are believed to show the future direction of the rest of the bond market."[4]

The quarterly Bellwether Report, published by the Institute of Practitioners in Advertising (IPA), monitors trends in expenditure in the UK advertising and marketing industry.

In law

In politics