Wall St back at Square One, with S&P flat in 2011
By Angela Moon
December 30, 2011
NEW YORK (Reuters) – For the U.S. stock market, 2011 was a long wild ride to nowhere.
The broad S&P 500 endured huge daily swings but a year of drama left the index almost where it started. It lost a mere 0.003 percent, closest to unchanged since 1947, according to Standard & Poor’s.
Global markets have been battered this year by the euro-zone debt crisis, upheaval in the Middle East, and U.S. political gridlock. Similar events probably await investors in 2012.
“The earnings and fundamentals were there for companies, but the political crisis and paralysis in Washington and Europe were too much,” said Martin Sass, who founded and runs the $7.5 billion M.D. Sass hedge fund.
“They overwhelmed the fundamentals. I didn’t think the euro- zone crisis would have been so protracted as it has become.”
The Dow industrials gained 5.5 percent for the year as investors sought safety in large-cap, dividend-paying stocks. The Nasdaq lost 1.8 percent.
Investors took out their ire on the financials <.GSPF>, which were the weakest group this year, falling more than 18 percent. Concerns about exposure to Europe and the threat of a renewed financial crisis hurt those shares.