bellwether

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Barometer Stock

A stock in a well-known or highly-regarded company in a given sector. The performance of a barometer stock is considered to be an indicator of the performance of its particular sector or industry. The term "barometer stock" is chiefly British; in the U.S., the primary term is bellwether stock.

Bellwether Security

A stock or other security that usually leads the direction of its industry or sector. For example, if a stock begins a bullish or bearish trend a little bit ahead of other stocks, it may be said to be a bellwether security. It should not be confused with a bellwether issue.

bellwether

A security that tends to lead the market and signal the general direction of future price movements. An increasing price for a bellwether stock is considered a bullish signal for the overall stock market.
Case Study Securities maintain their bellwether status for varying periods of time. The common stock of General Motors Corporation was considered the stock market's bellwether for many years, until the American economy transitioned from manufacturing to computers and information management and GM's status was supplanted by the stock of International Business Machines. IBM stock's perch as a market bellwether was subsequently replaced by the common stocks of Microsoft and Cisco Systems, two major players in the new Internet economy. The 30-year Treasury bond served as the bond market's bellwether for nearly two decades, until the 10-year Treasury note took its place in the early 2000s. Unlike stocks that lost their status because of their company's products or services, the 30-year bonds were replaced as a benchmark because the U.S. government redeemed a large portion of its long-term debt, causing the 30-year bond to lose its important status in the bond market. The Treasury announced in late 2001 that sales of the 30-year Treasury bonds would be discontinued.

Bellwether.

A market bellwether is a security whose changing price is considered a signal that the market is changing direction.

It gets its name from the wether, or castrated ram, that walks at the head of a shepherd's flock. The distinctive tone of the bell around the wether's neck signals the flock's position.

There's not an official list of these trend setters, or market barometers, and they do change as the overall markets and the fortunes of individual companies change.

References in periodicals archive ?
In July 2010, a jury delivered a 12-0 verdict in Yamaha's favor in the first bellwether case to be tried out of hundreds of consolidated cases involving Rhino-related injuries across the country.
also recently have been obtaining victories in major bellwether cases.
Bellwether trials refer to the old shepherds' practice of belling a wether, or putting a bell around the neck of a male sheep chosen to lead a flock.
The bellwether trial is a high-visibility trial that sends a message," he says.
Plaintiffs examine the outcomes of bellwether trials in order to decide whether similar cases should be abandoned or settled for nominal amounts, or whether the litigation might proceed to a point that could result in a significant settlement from the defendants.
Professor Alexandra Lahav of the University of Connecticut School of Law says more judges have been structuring consolidated mass tort cases into bellwether trials over the past five years.
Merck fought the claims and prevailed in four of five total Vioxx bellwether trials.
There are no concrete rules about how cases should be selected as bellwether trials, which worries some scholars (see "Concerned Observers").
The defendant has to consider how tough a case it wants to take on as its first bellwether trial," Cereghini says.
When the first bellwether trial or trials involve those ingredients, then the litigation is likely to be resolved with fewer bellwether trials," Cereghini says.
Sometimes it can be an advantage to have the first early bellwether trials involve punitive damage claims because plaintiffs have the opportunity to present every bit of evidence that they think goes to that claim," Cereghini says.
There were 303 respondents each from the bellwethers of Hillsborough and Monroe counties respectively, identified separately from the statewide poll.