Knowledge Sections

Sector & Industries

All economic activities are categorized in specific sectors and industries in each sector. Your business depends on the overall country’s economic conditions and on the performance of the specific sector in which you operate.

MacroVar analysis aims to help you predict how the sector and industry you operate in will behave in the next 6 to 12 months.

Sectors & Industries Overview

There are two types of sectors: cyclical and defensive. Companies in the cyclical sectors sell goods and services which are in demand only when the economy is strong (e.g. cars). Companies in defensive sectors sell basic goods and services (e.g. soap) which are essential for humans and are not sensitive to economic growth.

Cyclical sector companies are riskier since they go up and down with the economy, while defensive sector companies are steady earners in good and bad times. Cyclical sectors have much higher profitability than defensive sectors when economic growth conditions are strong.

Below is a list of cyclical and defensive sectors in the economy:

Sectors & Industries Indicators

MacroVar monitors each sector’s performance in the United States, Europe and Asia using the following indicators:

• Stock Sector & Industry performance: MacroVar analyses the trend and momentum and other statistics for each sector and industry. You can monitor the sectors & industries current performance here.
• Credit Sector & Industry performance: MacroVar analyses the corporate bonds of each sector and industry in the US and Europe.
• US ISM and NMI Industry Macroeconomic Analysis: MacroVar analyses the US ISM and NMI components to derive the strength or weakness of a specific sector.
• Europe ESI Macroeconomic Analysis: MacroVar analyses ESI sector and industry data for all European countries to estimate a sector's expected growth based on indicators like Production, Order Books, Export Order Books, Stock Levels, Production Expectations, Selling Price Expectations and Employment expectations.
• Macroeconomic Indicators: MacroVar analyses economic indicators affecting specific sectors and industries. For example. building permits are consistent leading indicators for construction activity in the next twelve month and University of Michigan Consumer Sentiment Index is a leading indicator for retail activity across the United States. A country's interest rates, Money Supply and the central bank's monetary policy and government's fiscal policy are closely monitored to examine liquidity in the economy and aggregate demand.
• Sector & Industry specific News: MacroVar compiles news by sector and industry and delivers the most important developments via your News feed and Newsletter.

The following is an in depth guide of how financial markets work and macroeconomic analysis in detail.