1. Dow Jones Transportation Average
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Transportation stocks such as FedEx (NYSE:FDX) and CSX (NYSE:CSX) are viewed as prime economic indicators, as are the airlines. The transports have slid nearly 30% from the peak reached in February of 2015. Investors are getting mixed messages from the sector. On Tuesday Delta Airlines (NYSE:DAL) reported record annual pre-tax income of $5.9 billion. Chief Executive Richard Anderson told investors the company will be a top performer this year despite economic challenges. Yet CSX CEO Michael Ward said he expects 2016 to be challenging, he made that statement during the company's earnings call last week. Still, the broader market is holding up better than the transports. The Dow Jones Industrial Average (NYSE:DJX) is down just 9.5% YTD through Wednesday.
2. Russell 2000 Index
The Russell 2000 Index (NYSE:RUT) represents the little guys. Most of these smaller cap companies do the bulk of their business domestically. Small caps have tumbled more than 25% from peak levels reached last June. The selling in this group is raising new questions about the health of the U.S. economy and whether or not the Federal Reserve jumped the gun by raising interest rates in December.
3. Japan's Nikkei 225
Japanese equity investors can't catch a break. The Nikkei 225 (NYSE:EWJ) entered a bear market on Wednesday falling more than 20% from the June high. Multiple and generous stimulus efforts by the Bank of Japan over the past year are falling flat. Companies including Toyota (NYSE:TM), which are also listed on the New York Stock Exchange (NYSE:ICE), remain under pressure. So far this year, the Japanese yen has advanced 2% versus the dollar. Japan is the world's third largest economy behind the United States and China.
4. Heng Seng Index
The health of China's economy remains one of the most debated global issues. On Tuesday, the country's report card, showed the economy grew 6.8% last quarter from a year ago, slightly less than the 6.9% pace in the third quarter. It was the weakest rate of expansion since 1Q 2009 but is still better than the U.S. which has been averaging annual growth of about 2%. Noted economist Nouriel Roubini told FOX Business he sees more of a hard landing for China over an outright collapse. Still, the Heng Seng Index is down over 20% compared to this time last year. China's Shanghai Composite, dominated by retail investors, is off 42% from the June high.
5. FTSE 100 Index
Investors know this index as the "footsie" which represents London's blue chips. Generally these companies are global behemoths such as oil monster BP (BP), which is also listed on the New York Stock Exchange (ICE). BP, like other oil companies, has been slammed by the collapse in oil prices. Both the WTI and Brent benchmarks are trading below the $30 level. Earlier this month, BP announced it will cut 4,000 jobs globally. The FTSE 100 slid into bear territory on Wednesday falling 20% from the record it hit back in April. Ironically, bear market territory for these stocks arrived as global big wigs gathered in Davos, Switzerland at the World Economic Forum.