Despite the general feeling that the U.S. stock market had a tough time in 2011, it turns out that we actually didn’t fare too badly. In fact, investors in the United States outdid the rest of the world by a pretty wide margin. And it seems likely that 2012 will be a repeat.
The S&P 500 finished the year flat on a price basis, but gained over 2 percent, including dividends, while the Dow Jones Industrials put up a respectable 8.4 percent gain. That doesn’t sound overly exuberant, but compared to the rest of the world it positively sparkled.
According to the Financial Times, global equity markets suffered a loss of $6.3 trillion in value during 2011, thanks to a series of crises, natural disasters, and concerns about the diminution of emerging nations’ growth rates.
The MSCI EAFE index of global non-U.S. stocks lost 15.74 percent for the year, while the Emerging Markets Index gave up 20.6 percent in value. That makes our single-digit gains look pretty good.
Interestingly, one of the few countries to turn in positive results besides the U.S. was beleaguered Ireland, up 7.75 percent as markets saluted its willingness to adopt decisive austerity measures. Greece, on the other hand, suffered a 65 percent plunge (on top of a 46 percent drop in 2010). Ouch.