European shares with annual gains but have worst December since 2002

With another day of declines, European stocks completed their worst December since 2002, trimming a fourth annual advance. The Stoxx Europe 600 Index fell 0.4 percent in the last trading day of the year, taking its monthly drop to 5 percent and paring the 2015 gain to 6.9 percent. The volume of shares changing hands was more than two-thirds lower than the 30-day average on Thursday, with markets including Germany, Switzerland and Italy closed, while the U.K., France and the Netherlands shut early.

The gauge has surged as much as 21 percent through its April record, buoyed by the European Central Bank’s stimulus -- concerns that China’s slowdown would hamper the global recovery took over, just as oil and commodities deepened their slumps and the Federal Reserve raised rates for the first time in more than a decade.

Most European markets rose this year. Germany’s DAX Index climbed 9.6 percent, and strategists are betting the gauge has more to rally. France’s CAC 40 Index has advanced 9.5 percent, with PSA Peugeot Citroen and Renault SA surging more than 55 percent. Italy’s FTSE MIB Index was among the best performers, rallying 13 percent. Spain’s IBEX 35 Index, on the other hand, fell 6.2 percent amid political uncertainty. The U.K.’s FTSE 100 Index, hurt by miners’ slumps, fell 4.5 percent. Greece’s ASE Index is again one of the world’s biggest losers. It’s plunged 26 percent in 2015, as its banks reached record lows.

After outperforming global shares in the first six months of the year, with the benchmark regional index touching the highest level since 2008, Asian equities slid in the second half on China’s surprise yuan devaluation and investor concern about the Federal Reserve’s interestrate outlook. Policy makers raised U.S. rates this month for the first time in almost a decade and signaled gradual tightening in 2016.

This article was compiled byValletta Fund Management Limited, a member of the BOV Group.Valletta Fund Management,TG Complex, Suite 2, Level 3, Brewery Str., Mriehel BKR 3000 Freephone: 80072344. E-mail: infovfm@bov.com. Website: www.vfm.com.mt. Valletta Fund Management Limited is licensed by the MFSA.