(New throughout, updates prices and market activity to close of
trading, adds comments, details on metals, bond indexes)
* US stocks end slightly lower in 2015; Europe mostly higher
* Crude oil down 30 pct in 2015, seen hitting $20
* Commodity currencies among year's worst performers
* Most major asset classes weaken in 2015
By David Gaffen
NEW YORK, Dec 31 (Reuters) - Stock and bond markets in major
economies closed 2015 with a mixed performance, while oil prices
and emerging markets cemented big losses during a year that
provided few safe places for investors.
While equity markets in Japan and Western Europe gained
strongly amid ongoing ultra-easy monetary policy, concerns about
global growth and a robust U.S. dollar crushed petroleum prices
and took down emerging markets, copper and other metals.
Fixed-income posted a middling performance, as riskier
high-yield securities fell, largely due to exposure to weakened
energy credits. Short-dated U.S. Treasury yields rose.
The MSCI All-World Index .MIWD00000PUS was down 0.7
percent, and closed the year with a loss of 4.2 percent.
For Wall Street's most widely followed average, the Standard
& Poor's 500 Index, it was down to the last day of trading to
determine whether the year would end negative or not. The
benchmark index lost nearly 1 percent for the day, giving its
price a 0.7 percent loss for 2015. Including dividends, it
posted a positive total return for a seventh straight year.
The market's ups and downs this year were triggered by
worries about oil, global growth and the Federal Reserve. The
uncertainty surrounding the U.S. central bank's plans dominated
the last several months of trading, and some were glad to see it
finally begin raising rates.
"I think that now that the Fed finally did something it will
calm the intraday jitters a bit at least for the first six
months, and hopefully see investors more committed to positions
rather than nervous to hold anything," said J.J. Kinahan, chief
strategist at TD Ameritrade.
The Dow Jones industrial average .DJI fell 1 percent to
17,425.03, the S&P 500 .SPX lost 0.94 percent to 2,043.92 and
the Nasdaq Composite .IXIC fell 1.15 percent to 5,007.41.
Brent crude LCOc1 gained 3.1 percent to $37.60 on
Thursday, after a 3.5 percent drop in the previous session. For
the year, Brent slid 34 percent after shedding 48 percent the
previous year, and a global supply glut shows no sign of
abating. U.S. crude lost 30 percent in 2015, after falling 47
percent in 2014. O/R
Some analysts like Goldman Sachs (N:GS) say prices as low as $20
per barrel might be necessary to push enough production out of
business and allow the market to rebalance.
Europe's Eurostoxx 50 index .STOXX50 ended the year with
gains of 3.5 percent, after losing a bit of ground Thursday.
In Asia, Tokyo's Nikkei index, which was closed on Thursday,
finished the year up around 9 percent .N225 . Other Asian
markets have been hit by worries about China, the world's second
largest economy, and by oil prices near 11-year lows.
MSCI's broadest index of Asia-Pacific shares outside Japan
.MIAPJ0000PUS was up slightly on Thursday but shed nearly 12
percent this year. Broader emerging market stocks .MSCIEF lost
17 percent in 2015.
The outperformance in European and Japanese equities has a
lot to do with a strengthening dollar, which has weakened their
currencies over the last few years and made their exports more
competitive.
The euro EUR= was down 0.6 percent on Thursday, and fell
10 percent against the dollar in 2015. Against a basket of major
currencies in 2016 .DXY , the greenback gained 9 percent, with
a rebounding jobs market convincing the Federal Reserve to 'lift
off' on interest rates earlier this month.
"The Fed could come back with a second hike in March, which
is not fully priced in, and the dollar should draw fresh support
from that," said Richard Franulovich, senior currency strategist
at Westpac in New York.
Currency strategists predict the dollar will add another 4
percent next year.
The dollar was particularly strong in 2015 against commodity
currencies: It hit a more than one-year high against Russia's
rouble RUB= on Thursday, and its highest in at least 13 years
against the Norwegian crown NOK= the previous day.
In debt markets, the U.S. 10-year Treasury yield US10YT=RR
was at 2.275 percent; it rose modestly in 2015 from 2.17 percent
at the beginning of the year.
Much of the year's rise in yields was in short-dated
securities on expectations of higher rates from the U.S. Federal
Reserve. The two-year yield US2YT=RR rose to 1.05 percent,
compared with 0.68 percent at the beginning of the year.
German bonds ended their most volatile year since 2011 with
yields higher than they were at the end of 2014, showing the
limitations of ultra-easy monetary policy with global
disinflationary forces at work.
Ten-year yields DE10YT=TWEB closed at 0.63 percent on
Wednesday, up 9 bps on the year and far from record lows of 0.05
percent touched in mid-April.
High yield debt was the worst performer among fixed income
in 2015. The Bank of America-Merrill Lynch U.S. High Yield index
fell more than 4.6 percent for the year; its U.S. Treasury index
gained about 0.65 percent.
Metals were broadly weaker in 2015. Copper futures CMCU3
lost 25 percent on the year, while spot gold XAU= fell 10.5
percent.
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Year-to-Date Returns http://link.reuters.com/syf98v
2015 asset performance http://tmsnrt.rs/1Ml1UzG
Emerging market currencies in 2015 http://link.reuters.com/jus35t
Bonds in 2015 http://link.reuters.com/var26w
METALS-Base metals slump, face another storm in 2016
UPDATE 8-Oil ends 2015 down 35 pct; long, painful hangover seen
O/R
US STOCKS-S&P 500 poised for uninspiring end to turbulent 2015
.N
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