| Trading the Advance GDP Numbers |
by S. Wade Hansen Advance Gross Domestic Product (GDP): A Glimpse Into the Health of the Economy Once a quarter, the Bureau of Economic Analysis gives us a glimpse into the state of the U.S. economy by releasing its Advance Gross Domestic Product (GDP) numbers. Traders love this information because as goes the economy so goes the stock market.  The higher the Advance GDP number, the stronger the economy is and the higher stock prices will typically go. The lower the Advance GDP number, the weaker the economy is and the lower stock prices will typically go. Of course, there are certainly other factors you should be looking at when determining the health of the economy so Don't Read the News in a Vacuum.
The Gross Domestic Product (GDP) number is the broadest measure of economic activity for the U.S. economy. GDP measures consumption + gross investment + government spending + (exports - imports). The Advance GDP is the first GDP announcement the Bureau of Economic Announcement makes. The Advance GDP number is followed up by the Preliminary GDP, which is followed up by the Final GDP number. You can see the most recent Advance Gross Domestic Product (GDP) report here. Stocks to Watch The Advance GDP number is especially important for shareholders in the nations largest companies. When you see the Advance GDP number rising, it is a good sign for most companies and will typically have a positive impact on the price of their stocks. When you see the Advance GDP number falling, it is a bad sign for most companies and will typically have a negative impact on the price of their stocks. Here are a few of the companies with broad economic reach you should keep an eye on: - General Electric (NYSE: GE) - The Walt Disney Company (NYSE: DIS) - Time Warner Inc. (NYSE: TWX ) - Google Inc. (NSDQ: GOOG) Keep up with us:
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3.25 Copyright (C) 2007 Alain Georgette / Copyright (C) 2006 Frantisek Hliva. All rights reserved." |
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