Market Sentiment Tracker: What Our 900 Impact-Weighted Indicators Say

Across 2025 I tracked roughly 350–400 US macro indicators, classifying each release as bullish or bearish based on surprise direction trend and economic relevance. On a simple count basis about 56 percent of signals were bullish and 44 percent were bearish. However once we apply impact weighting the balance starts to tip. High-impact indicators tied to inflation and household purchasing power accounted for approximately 30 percent of total weight, and within this group nearly 65–70 percent of releases were bullish as core CPI repeatedly undershot forecasts prices-paid components eased and inflation expectations declined. Labor market indicators represented roughly 25 percent of total weight, and here close to 60 percent of signals were bearish as unemployment measures continuing claims and job cuts trended higher despite stable headline payrolls. Housing carried an estimated 20 percent weight, with nearly 70–75 percent of housing signals negative due to elevated mortgage rates weak applications and affordability constraints making it the single most persistent drag on the common household. Growth and activity indicators made up the remaining 25 percent, split close to 50-50, reflecting resilient services and GDPNow stability offset by weak manufacturing breadth. In aggregate the weighted signal mix perfectly explains the mixed headlines regarding the US economy.
 

For China, I have used 200–250 China macro indicators, classifying each release as bullish or bearish based on surprise direction momentum and economic relevance. On a simple count basis the signal mix appeared mixed at times due to sporadic improvements in exports services PMI stability and marginal policy steadiness. However, once weighted by economic impact the picture turns decisively weaker. High-impact indicators tied to credit demand investment and domestic confidence, which we estimate carry roughly 40 percent of total weight, were overwhelmingly bearish with nearly 75–80 percent of these signals negative. Repeated collapses in new loans and total social financing persistent weakness in fixed asset investment declining house prices and soft retail momentum all point to impaired internal demand. External trade indicators contributed some relief with exports rebounding intermittently and trade surpluses remaining elevated but these accounted for only 20 percent of total weight and were increasingly offset by sharp declines in exports to the US and weakening import growth signaling domestic softness. Policy and liquidity indicators represented about 20 percent, and while loan prime rates and M2 growth appeared stable only 45–50 percent of these signals were bullish as credit transmission remained weak. Labor and sentiment indicators made up the remaining 20 percent, skewing modestly bearish. In aggregate China’s 2025 profile reflects stabilization without recovery driven more by external trade than domestic demand.

Across 2025 the Eurozone macro signal was dominated by growth fragility and disinflation rather than labor or financial stress. For this I used roughly 250 to 300 Eurozone indicators classifying each release as bullish or bearish based on surprise direction trend persistence and economic relevance. On a headline count basis signals were roughly balanced with about 52 percent bullish and 48 percent bearish but impact weighting materially altered the picture. Growth and activity indicators carried approximately 35 percent of total weight and within this group close to 65 percent of signals were bearish as manufacturing and construction remained in contraction industrial production failed to recover and Germany continued to act as a structural drag despite resilient services. Inflation indicators represented about 25 percent of total weight and were predominantly bullish with roughly 60 percent of releases positive as headline inflation eased producer prices stayed deeply negative and policy flexibility improved despite intermittent core stickiness. Consumer indicators accounted for approximately 20 percent of total weight and were largely bearish with nearly 70 percent of signals negative reflecting persistently weak confidence and defensive spending behavior. Labor and financial conditions together made up the remaining 20 percent and were broadly neutral with stable unemployment contained spreads and no systemic stress. In aggregate the Eurozone in 2025 seemed to be grasping for stability without momentum leaving growth narrow and policy dependent.