Hakob Stepanyan

Do the Indicators Really Matter for Futures Pricing?

The following report will address the issue of the interaction between the ten leading indicators, released by the Conference Board, and the S&P 500 Futures.  The empirical study held the set of futures prices, from 1997 to 2007, as the dependent variable and used the ten leading economic indicators as the independent variables. Due to the nature of some of the economic indicator reports, they have varying effects on the futures prices because the futures contracts expire quarterly, the economic news released monthly have varying effects on a constantly changing and very dynamic derivative. The final outcome of the study concluded that the consumer expectations (of economic conditions and the future of the economy) and the monthly average of the weekly jobless claims had the most significant impact on the movement of the futures prices for the study period.