Origins
The word 'indicate' preserves one of the oldest meanings in the Indo-European language family: the act of pointing. Where many words from PIE *deyk- drifted toward speech and proclamation ('dictate,' 'diction'), 'indicate' kept the physical gesture alive — to indicate is, at its etymological core, to point a finger toward something.
English adopted the word in the mid-seventeenth century from Latin 'indicātus,' the past participle of 'indicāre' (to point out, to show, to make known, to disclose). The Latin verb is formed from 'in-' (into, towards) plus 'dicāre' (to proclaim, to make known), itself related to 'dīcere' (to say) and ultimately from PIE *deyk- (to show, to point out). The prefix 'in-' here carries directional force: to indicate is to point something towards someone's attention.
The noun 'index' is closely related, deriving from the same Latin formation ('in-' + a root form of 'dīcere'). In Latin, 'index' (genitive 'indicis') meant 'one who points out, an informer, the forefinger, a sign, a title, a list.' The forefinger is the 'index finger' because it is the pointing finger. A book's index is a pointer to its contents. A price index points to economic conditions. The stock index points to market health. In each case, the metaphor of pointing endures.
Scientific Usage
The medical use of 'indicate' has a specific and important sense. When a symptom 'indicates' a disease, or a condition 'indicates' surgery, the word means that observable signs point toward a diagnosis or treatment. 'Indication' in medicine is a formal term: a valid reason for performing a procedure. Its opposite, 'contraindication,' means a sign pointing against a treatment — a reason not to proceed. This medical usage dates to the seventeenth century and reflects the diagnostic tradition of reading the body's signs.
'Indicator' (one who or that which points out) entered English in the seventeenth century. It became a technical term across many fields: economic indicators, chemical indicators (substances that change color to show pH), indicator species (organisms whose presence signals environmental conditions), and turn indicators on vehicles. All preserve the core meaning of something that shows or signals.
The grammatical term 'indicative mood' also comes from this root. The indicative mood is the mode of pointing out facts — stating what is, as opposed to the subjunctive (what might be) or the imperative (what should be). A sentence in the indicative mood indicates reality.
Latin Roots
The word family around Latin 'dicāre' (the causative form meaning 'to proclaim, to devote') also produced 'dedicate' (to devote formally), 'abdicate' (to renounce, literally to proclaim away from), 'predicate' (to proclaim about, the part of a sentence that states something about the subject), and 'vindicate' (to claim for oneself, to justify, from 'vim dicāre' — to declare force/authority). Each represents a different direction of proclamation, but 'indicate' alone preserved the root's most ancient sense: the simple, spatial act of pointing something out.