security seen as an indicator of a market's direction. In stocks, IBM has long been considered a bellwether because so much of its stock is owned by institutional investors who have much control over supply and demand on the stock market. In bonds, the 30-year U.S. Treasury Bond is considered the bellwether, denoting the direction in which all other bonds are likely to move.
security seen as an indicator of a market's direction. In stocks, 3M Company (MMM) is considered both an economic and a market bellwether because it sells to a diverse range of other producers and because so much of its stock is owned by institutional investors who have much control over supply and demand on the stock market. Institutional trading actions tend to influence smaller investors and therefore the market generally. There are bellwethers in specific industries; for example, Microsoft and Intel act as bellwethers for the technology stocks. In bonds, the 10-year U.S. Treasury note is considered the bellwether, denoting the direction in which all other bonds are likely to move.
