Market Round Up: December 26-30, 2011
Markets were relatively calm last week. US markets closed down slightly, while Canadian markets closed modestly up. While worries about the Eurozone and the US economy persist, investors seemed willing to ignore issues until the New Year. Extreme volatility and major losses over the year meant that 2012 ended with the first annual loss since 2008, and 6.3 Trillion dollars were “wiped off markets” in 2011. Global stock market capitalisation dropped 12.1 per cent to $45.7tn.
The S&P, which performed well in the last quarter, rising 11%, dropped 0.02% over the year. With regards to bank stocks in particular, US Bank Shares dropped approximately 20% in 2011, and European Bank Stocks dropped around 30%. The FTSE Eurofirst 300 index, a more general tracker, dropped around 11% in 2011. “Asian equity markets were hit particularly hard with Japan’s Nikkei index losing 17.3 per cent this year, Hong Kong’s Hang Seng index 20 per cent and the Shanghai Composite 22 per cent.”
Volatility, the new norm of equity markets, was also evident in Bond yields and currencies. The Japanese Yen gained over the year against the US dollar, while the Euro was the weakest currency over the year. UK and US bonds were considered relatively safe, while Greece and Italy faired poorly.