2012. On Wall Street it has been a year marked less by excited cries of “buy!” and “sell!” than by sighs of “ho-hum!”
But behind the respectable, though not heart-stopping, 7 percent return for the Dow Jones industrials this year, there are reasons for cheer for investors as we head into 2013.
Here’s a list, worth checking twice, as we close out the year.
2012 brought some much needed housecleaning to the corner office: From Yahoo! to Avon to Citigroup, the boards of some of America’s worst-run companies finally woke up and shook up the status quo by installing new CEOs.
Bold-faced scandals didn’t have legs: Sure, big bad bets by the so-called London Whale at JPMorgan left the bank with egg on its face and billions in losses this summer. It also cost the talented Ina Drew her job.
But deft management of the crisis by JPMorgan CEO Jamie Dimon kept the whale from enveloping his reputation and that of the rest of the firm. As a result, JPMorgan stock has been a stellar performer on the year, up nearly 30 percent.
The presidential election didn’t roil the markets: Time will tell what the long-term impact of the November results will have on Americans’ bottom line. But for this year, at least, the most contentious and misread election season in decades didn’t derail investors.
Housing showed signs of life: Those investors who ignored all the statistical noise on housing and just looked around their neighborhoods were richly rewarded if they took a bullish bet on the home front in 2012. The prize for the best-performing exchange-traded fund of the year goes to the iShares Dow Jones US Home Construction Index, which is up nearly 70 percent. Not bad.
Europe didn’t implode: Despite tear gas in the streets and a tip into recession, the European Monetary Union held together in 2012. Indeed, in another example of how it pays to be a contrarian, the FTS index of Europe’s 300 biggest stocks had a banner year, up 13 percent or about twice the gains of the Dow here in the US.
And there you have it: some reasons 2012 wasn’t such a bad year after all on Wall Street. Let’s hope 2013 brings more of the same.