Data is updated weekly as part of the Market Analysis service.
The ASX Bull-Bear Leading Index is at 54, down from 64 two weeks ago, signaling a bear market.
Two of four Australian indicators signal risk-off after the 3-month moving average of NAB Forward Orders fell to -2 for May 2026. One of two Chinese indicators signals risk-off, and the ASX 200 Financials Index is testing primary support, placing us on bear watch.
Australian leading indicators carry a 40% weighting in the ASX Leading Index, China 20%, and the US Leading Index carries the remaining 40%.
Forward Orders
NAB Forward Orders recovered to zero in May 2026, from -5 in April, but the 3-month moving average fell to -2. The 3-month MA below zero signals risk-off.
Housing Sector
Activity in the Australian housing sector is improving, with the 3-month moving average of private housing approvals rising to 17.4K in April. A cross of 3-month MA values (navy) to below the 20-year MA (red) would signal risk-off.
Financial Sector
The ASX 200 Financials Index (XFJ) is below its 50-week weighted moving average and continues to test primary support at 9000. A breach of 9000, confirmed by a follow-through below 8900, would signal a primary downtrend and indicate risk-off.
ASX 200 Real Returns
The ASX 200 is above its 50-week moving average, but the long-term downtrend relative to Gold continues, signaling risk-off.
Performance of the ASX 200 Index relative to Gold (in Australian Dollars) reflects the real return on Australian Stocks.
China
The OECD Composite Leading Indicator for China lifted to 98.91 in May, from 98.8 in April. Values below 99.0, or a fall of more than 3 points from the preceding peak, signal risk-off.
China is Australia’s largest export market, and the performance of the Chinese economy directly impacts the ASX.
Chinese Manufacturing
The Chinese NBS Manufacturing PMI eased to 50 in May, indicating continued expansion. Values below 49.0 signal risk-off.
Conclusion
The Bull-Bear indicator signals the start of a bear market, while the ASX 200 Financials Index remains close to its risk-off threshold, keeping us on bear watch.
Related Links
Acknowledgments
- NAB: Monthly Business Survey
- ABS: Private Dwelling Approvals
- Trading Economics: China Business Indicators
- OECD: Composite Leading Indicators
- ABS: National Accounts