MarketView for December 30

Summary 

Trading on Wall Street ended the year with a whimper, a result that was not too surprising when you consider that overall, the 2011 was essentially a long wild ride to nowhere. The S&P 500 index 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 our own political gridlock. The Dow Jones Industrial Average 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, 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. Bank of America was the Dow's worst performer, falling 58.3 percent this year, and it was also one of the S&P 500's largest losers. JPMorgan Chase fell 21.6 percent in 2011.

Cabot Oil & Gas was the only S&P component to double its stock price in 2011 - rising 100.5 percent - followed by another energy name, El Paso, which rose 93.1 percent. The S&P 500 's weakest stock was First Solar, as shares of that company were hit by falling solar panel prices. For the year, the stock was off 74.1 percent.

Defensive sectors like utilities outperformed growth sectors, underscoring the view that investors were concerned about the economic outlook. McDonald's was up 31 percent for the year, making it the Dow's largest gainer.

Reflecting the wild market swings, the CBOE Volatility Index rose about 32 percent for the year, the first increase since 2008. The S&P 500 climbed 9 percent at its peak, and dropped 14.5 percent to its bottom.

One potential silver lining headed into 2012 is that after relatively flat years, the market tends to bounce.

Daily volume this week has been running about half of the average, with many traders away for the Christmas and New Year's holidays. The anemic action amplified moves in both directions.

European shares closed up on Friday, but recorded their largest annual drop in three years as debt tensions in the euro zone strained the financial sector and threatened to derail a fragile economic recovery. Some believe investors may have become too panic-stricken about Europe, an issue that will dominate headlines in coming months.

About 4.07 billion shares changed hands on the three major equity exchanges, a number that was  well below this year's daily average of about 7.84 billion shares.