On its last trading day of the year, Wall Street closed pretty much where it started, but stock markets in Europe and Asia finished steeply lower.
On Friday, the Standard & Poor's 500-stock index closed with a 0.4 percent loss for the day, while the Dow Jones industrial average fell 0.6 percent.
That left the S&P 500, a benchmark for the broad market, statistically unchanged for the year – a 0.00 percent difference, from 1,257.64 on Dec. 31, 2010, to 1,257.60 on Dec. 30, 2011 – while the Dow was up 5.5 percent for the year, closing at 12,217.56.
Major European and Asian indexes, however, descended by double-digit percentages in 2011.
The FTSE 100 index of leading British shares closed up 0.1 percent for the day but down 5.6 percent for the year, while Germany's DAX ended 0.9 percent higher for the day and 14.7 percent lower for the year.
The CAC 40 in France closed up 1 percent, about 17 percent down for the year. The Nikkei 225 closed down more than 17 percent for the year, while the Hang Seng Index was down nearly 20 percent.
Trading volumes thinned during the holiday season, capping off with a whisper what was a year of political turmoil and financial upheaval that saw governments overturned and prospects for sovereign defaults sharpen.
The eurozone debt crisis set off volatile swings in equity markets that had investors turning to safer assets, while one of the safest assets historically – U.S. debt – suffered its first downgrade to its AAA credit rating.
On Friday, crude oil futures traded in New York were slightly lower at $99.23 a barrel, after rising to $101.34 this week, their highest level since June. In recent days, tensions have bubbled to the surface after Iran threatened to close the Strait of Hormuz if sanctions were imposed on its oil shipments.
Materials and energy shares rose the most Friday, although their gains were less than 0.5 percent in early trading. Financial stocks were down, following their 2011 trend.
The yield of the benchmark 10-year Treasury, which moves in the opposite direction of its price, was down 2 basis points Friday to 1.876 percent, on track to finish the year well below its 3.75 percent yield in the beginning of 2011.
"The great Treasury rally of 2011 was attributable in large part to events that many of us would have considered unlikely at that time," said Kevin H. Giddis, the executive managing director and president for fixed-income capital markets at Morgan Keegan & Company, "namely, the Arab spring, the loss of the United States' AAA rating, the devastating earthquake in Japan, and the European monetary pact becoming dangerously close to breaking apart.
As 2011 ends, "the investing landscape doesn't look all that different," he wrote in a year-end market commentary. "To put it charitably, economic conditions in Europe remain tenuous, with no clear end in sight."
Some analysts expect the focus in 2012 to swing back to fundamentals in the United States as investors try to gauge how successfully the country can "de-couple" from Europe's woes.
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