Leading index → German stocks

Common explanation (Knock-on · same direction): Germany relies on export manufacturing and is deeply embedded in global supply chains, so global demand directly affects its exports and investment.

This issue: Leading index at 42 (neutral), German stocks at 72 (warm) — at least one is in the neutral range (40⁠–⁠60), so we make no call this issue.

Hot and cold describe position, not good or bad: warm does not mean a fall is coming, and an extreme reading does not mean a quick reversal. We describe history only, with no buy or sell advice.

Where it stands now

Where the two indicators stand this issue

Leading index: Now 100.14. German stocks: 35.5% above its 10-year average.

Tests

Does this link hold up?

Common explanationGermany relies on export manufacturing and is deeply embedded in global supply chains, so global demand directly affects its exports and investmentSource: OECD, “Germany: OECD Economic Outlook, Volume 2026 Issue 1” (2026). It discusses Germany’s economy, not its stock market.
Tested against our dataAgreement between the positions of Leading index and German stocks (3-month lag), measured in the direction of the common explanation: +0.24. Looking at every 5-year period (shifted one year at a time), the two moved in that direction in 34 of 42. Weak or inconsistent
Periods when it did not holdAcross 42 5-year periods, out of step in 1982⁠–⁠1999 and 2000⁠–⁠2005.

History

The two lines, overlaid

Data: Organisation for Economic Co-operation and Development (OECD), Composite Leading Indicators; OECD Main Economic Indicators (share prices). Positions: our calculation.

Leading indexGerman stocks

Limits

What this card cannot tell you

Moving together does not prove that one causes the other.
Links change over time; periods when this one did not hold are listed in full.
This is the historical record, not a forecast.

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