CHAPEL HILL, N.C. (MarketWatch) — The Transports are on a tear, and that’s good news for all equity investors.

Since the stock market’s lows last week, the Dow Jones Transportation Average DJT, -1.04% , the formal name for the Transports, has been one of the strongest of the broad-market averages, gaining 10%. That’s nearly triple the comparable gain for the Dow Jones Industrial Average DJIA, -0.87% and more than double that of the S&P 500 Index SPX, -1.11% .

The reason this is such encouraging news: The Transports are often considered a leading indicator of economic weakness, on the theory that transportation companies should be among the first to reflect any slowdown in economic activity that begins to appear on the horizon.

There turns out to be statistical support for this theory: A study conducted by the Bureau of Transportation Statistics in the U.S. Department of Transportation, titled “The Freight Transportation Services Index as a Leading Economic Indicator.” The authors found that their department’s index over the past three decades “led slowdowns in the economy by an average of 4-5 months.”

The Freight Transportation Services Index did a particularly good job warning investors of the Great Recession of 2008-09, by the way. The Department of Transportation study found that the index began to slump a full year and a half prior to that recession’s beginning. The broad stock market averages, in contrast, gave just two months’ advance notice.

To be sure, the study focused on the bureau’s Freight Transportation Services Index, the latest data for which only reflects activity during August. But the index did hit an all-time high that month.

It’s also worth noting that there is a close correlation between the Freight Transportation Services Index and the Dow Transports, and it’s well above its average level for August.

All of this, however, doesn’t necessarily mean the bull market is alive and well. It’s possible any upcoming rally would turn out to be the bull market’s last gasp. Such an outcome, in fact, would be consistent with a contrarian analysis of market sentiment.

Regardless, for now, at least, we can celebrate the Transports’ strength.

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