Bellwether stock

Just as the bellwether sheep is the one in the flock that all the others follow, so a bellwether stock is the one that is supposed to lead a market. It follows, therefore, that such stocks will be the ones with a big capitalization, which can also reflect signs of which way the economies in which they trade are heading. In the UK Vodafone and BP fulfill this role as do, for example, Microsoft, General Motors and General Electric in the United States and Mitsubishi and Nippon Steel in Japan.