In October, the CB Leading Index experienced a 0.8% decline.

Highlights

• In October, the CB Leading Index fell 0.8% compared to the previous month, falling short of what analysts had predicted. 
• Over the span of six months, the CB Leading Index saw a 3.3% decrease.
• The S&P 500 reached close to its highest level in several months as traders concentrated on the positive outlook for Federal Reserve policies.  

On November 20, The Conference Board published the CB Leading Index report for October, revealing a 0.8% month-over-month decline, slightly lower than the anticipated -0.7% consensus among analysts.

Over the six-month period from April 2023 to October 2023, the Leading Economic Index dropped by 3.3%. This marks an improvement from the previous six months, where there was a 4.5% contraction from October 2022 to April 2023.

According to The Conference Board, the recent decline in the index was driven by reduced consumer expectations for business conditions, a decrease in the ISM Index of New Orders, a drop in equities, and tighter credit conditions.

The Conference Board foresees that a blend of elevated inflation, high interest rates, and reduced consumer spending will lead to a brief recession in the U.S. economy.

The U.S. Dollar Index is hovering near the 103.50 level, close to its lowest point for the session, due to the focus on the conclusion of the rate hike cycle. The underwhelming report may exert additional pressure on the American currency.

Despite a weaker dollar, gold retreated towards the $1970 level, suggesting diminishing demand for the safe-haven metal as traders do not foresee strong catalysts to propel gold beyond the critical $2000 level.

The SP500 approached session highs near the 4530 level, with the outlook for Federal Reserve policies remaining the primary influence on equity markets. Traders are anticipating the Fed to commence interest rate cuts in the first half of 2024 and are disregarding the risks of a recession.