Dow Jones Economic Sentiment Indicator Rebounds on Positive Job, Earnings Reports

NEW YORK, May 2, 2011 /PRNewswire/ -- The Dow Jones Economic Sentiment Indicator in April landed slightly higher than the February figure, wiping out the large decline seen in March. The ESI hit 46.6 last month, up from 43.2 in March and just above the 46.5 tracked in February.

"The rebound suggests the March number was a blip, probably caused by the after-effects of Japan's earthquake and Tsunami," said Dow Jones Newswires "Money Talks" columnist Alen Mattich.

The ESI is determined by in-depth sentiment analysis of national news coverage across 15 daily newspapers. It is reported on a scale of 0 to 100; higher numbers represent increasingly positive sentiment.

Positive media coverage accelerated toward the end of April, in part because of healthy earnings reports, especially from Big Oil. Improvement in the job markets was also part of the coverage signaling future economic growth.

Negative coverage continued to focus on the drag from higher energy prices slowing down consumer spending.

"The April index seems to have confirmed the story coming from the Federal Reserve: that the U.S. economy is holding its own, but isn't hitting any home runs," said Mattich.

The Dow Jones Economic Sentiment Indicator aims to predict the health of the U.S. economy by analyzing the coverage of 15 major daily newspapers in the U.S. Using a proprietary algorithm and derived data technology, the ESI examines every article in each of the newspapers for positive and negative sentiment about the economy. The indicator is calculated through Dow Jones Insight, a media tracking and analysis tool. The technology used for the ESI also powers Dow Jones Lexicon, a proprietary dictionary that allows traders and analysts to determine sentiment, frequency and other relevant complex patterns within news to develop predictive trading strategies.

The ESI's back-testing to 1990 shows that indicator clearly highlighted the risk that the U.S. economy was sliding into recession in 2001 and 2008 and suggests the indicator can help predict economic turning points as much as seven months in advance of other indicators. For more information, visit http://dowjones.com/esi.

About Dow Jones Insight

Dow Jones Insight  (http://www.dowjones.com/product-djinsight.asp) uses innovative text mining and analytic technologies to help organizations keep informed about relevant issues, news, conversations and trends emerging in mainstream, Web and social media.  Dow Jones Insight's global content collection includes more than 25,000 news and information sources as well as blogs, message boards, and posts from YouTube and Twitter.  

About Dow Jones

Dow Jones & Company is a global provider of news and business information and a developer of technology to deliver content to consumers and organizations across multiple platforms. Dow Jones produces newspapers, newswires, Web sites, apps, newsletters, magazines, proprietary databases, conferences, radio and video.  Its premier brands include The Wall Street Journal, Dow Jones Newswires, Factiva, Barron's, MarketWatch, SmartMoney and All Things D. Its information services combine technology with news and data to support business decision making. The company pioneered the first successful paid online news site and its industry leading innovation enables it to serve customers wherever they may be, via the Web, mobile devices and tablets. The Dow Jones Local Media Group publishes community newspapers, Web sites and other products in six U.S. states. Dow Jones & Company (www.dowjones.com) is a News Corporation company (NASDAQ: NWS, NWSA; ASX: NWS, NWSLV; www.newscorp.com).

The Dow Jones Economic Sentiment Indicator is provided for analysis purposes only and Dow Jones makes no representation that the indicator is a definitive predictor of sentiment or the health of the U.S. economy.  This report does not in any way reflect an opinion of Dow Jones regarding the U.S. economy or the suitability of any investments.

SOURCE Dow Jones & Company