LIVE MARKETS-Leading economic index posts biggest monthly drop in over two years

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LEADING ECONOMIC INDEX POSTS BIGGEST MONTHLY DROP IN OVER TWO YEARS

On Monday, investors had one lone piece of data to hang their hats on. And it was a bit of a downer

the Conference Board's (CB) Leading Economic Index (LEI) USLEAD=ECI decreased by 1.0% in April, steeper than analysts expected and marking an acceleration from March's 0.8% decline.

Noting that April marked the largest monthly decline since March 2023, when recession fears were gathering steam, Justyna Zabinska-La Monica, CB's senior manager of Business Cycle Indicators, adds “Consumers’ expectations have become continuously more pessimistic each month since January 2025, while the contribution of building permits and average working hours in manufacturing turned negative in April."

"However, while the six-month growth rate of the LEI went deeper into negative territory, it did not fall enough to trigger the recession signal," she says.

CB's LEI is an amalgamation of ten forward-looking metrics (including initial jobless claims, ISM new orders, yield spreads and S&P 500 price performance, among others).

As a reminder that the stock market and the economy are two different things, the chart below shows the LEI against the S&P 500. Although historically, the two have moved in concert, they appear to have diverged toward the end of 2022, around the time the S&P 500 entered a bull market.

But last month's accelerated decline in the LEI corresponds with the bellwether index's post "liberation day" selloff:

(Stephen Culp)

MONDAY'S EARLIER LIVE MARKETS POSTS:

WALL ST SLUMPS ON MOODY'S DOWNGRADE AS LAWMAKERS WRANGLE TRUMP TAX BILL - CLICK HERE

U.S. FUTURES POINT TO DROP AT THE OPEN AFTER MOODY'S DOWNGRADE - CLICK HERE

ARE EUROPEAN EQUITY VALUATIONS HIGH? - CLICK HERE

THE DOLLAR'S FISCAL FROWN - CLICK HERE

FEES POWER BANK BEATS - CLICK HERE

LOWER BUT CALMLY - CLICK HERE

LOTS GOING ON, EUROPEAN FUTURES OUTPERFORM - CLICK HERE

MORNING BID: SO, CHINA SHOULD CONSUME MORE AND THE US LESS? - CLICK HERE