2011 was marked by an extremely weak price development in almost all international equity markets. Only the US equity market was able to set itself apart, with the Dow Jones Industrial Index (DJI) (leading index of the New York Stock Exchange) rising by 5.5% and the NASDAQ Composite Index (leading index of the NASDAQ technology exchange) keeping losses within limits with a drop of only 1.8%.
Persistent negative reports were symptomatic of the year just ended. Uncertain political developments in the countries of Northern Africa and the Middle East dampened generally positive market sentiment in the initial months of 2011. This was followed in the middle of March by a natural catastrophe in Japan that resulted in a nuclear reactor accident, leading to a sharp market correction. This fall was generally overcome and was followed by a phase of volatile upward movement. Positive company reports were, however, counterbalanced by two interest rate increases by the European Central Bank (ECB), rising fears of inflation and similarly increasing concerns about the health of public finances in Europe and the USA. Further intensification of the debt crisis and a deterioration in the economic outlook for 2012 led to massive stock exchange price losses in the middle of the 3rd quarter. The danger that the European debt crisis might spread outside Greece led to another significant correction in European stock markets in November 2011, while price movements were relatively favourable in the USA at the end of the year.
The US Dow Jones Industrial Index was able to achieve the full-year performance indicated above thanks to a good fourth quarter. The index ended the year at a value of 12,217.56, the third year-on-year increase in a row. The so far highest closing value for 2007, 13,264.82 points, has not, however, been reached again.
After especially poor performance by the financial stocks in the European Eurostoxx 50 equity index, the index closed 2011 at a value of 2,316.55 points, 17.1% lower than the value at the end of 2010. This was the second consecutive year of losses for the Eurostoxx 50.
The Japanese Nikkei 225 stock exchange index fell by 17.3% to 8,455.35 points, thereby also recording its second consecutive year of losses.
Most emerging market stock exchanges also moved downward in 2011. The euro-denominated Eastern European CECE Index followed this trend, falling by 29.1% to 1,498.73 points.