European shares tumble 11% in tough year

MADRID (MarketWatch)
European equities posted modest daily gains Friday in thin trading, but ended 2011 with heavy yearly losses as the euro zone’s sovereign debt crisis took its toll.
The Stoxx Europe 600 index  rose 0.9% to finish the day at 244.57.
But the index ended the year solidly in the red, falling 11.3% over the course of 2011, according to FactSet Research.
The Continent’s regional indexes were also hard hit.
Germany’s DAX 30 index ended a shortened session 0.8% higher at 5,898.35, tallying a yearly loss of 14.7%.
The French CAC 40 index  rose 1% to settle at 3,159.81, leaving its 2011 decline at 17%.
In Frankfurt, shares of Deutsche Bank AG up 0.3%, while Deutsche Post AG  rose 1%.
GDF Suez SA  rose 1.2% in Paris.
Shares of AXA SA rose 1.7%.
London’s FTSE 100 stock index outperformed its continental peers, but still ended the year with a 5.6% decline.
For the day, the index closed with a gain of 0.1% at 5,572.28 in an abbreviated session.
In London, BG Group rose 0.4% after saying that one of its projects in Brazil was getting close to production.
European markets posted little reaction to the new Spanish government’s announcement that the country was set to post a 2011 budget deficit equal to around 8% of gross domestic product, exceeding the previous government’s forecast of 6%.
The government outlined new austerity measures. 
Europe’s sovereign debt crisis and related jitters over the euro-zone banking sector have taken a toll on the Continent’s equity markets over the past year.
“The coming 12 months will be about finding the trade that is not overly crowded and being intelligent in not holding any position for too long,” said Stephen Pope, managing partner at Spotlight Ideas, in emailed comments.
“Any equity that relies on a single developed-market polarity for revenue generation is not an investment vehicle to follow. If one is to make any money from equities in the new year, it has to be from large caps that draw upon many diverse markets for sales generation,” said Pope.
Vestas was a top gainer for the Stoxx, rising 6% after the wind turbine maker received an order for 23 wind turbines from a wind power park in Sweden.
Shares of Banco Comercial Portugues SA jumped 3.8%.
Media reports have been circulating over the past few days that Portuguese and Chinese authorities have discussed the possibility of investment by a Chinese bank in BCP..
A spokesman from BCP could not immediately be reached for comment, but the firm has previously declined comment.
The end of a turbulent year
Many investors will likely be glad to see the back of 2011, which has been a turbulent year for markets, owing to the sovereign-debt crisis.
German Finance Minister Wolfgang Schaeuble on Friday vowed that European leaders will get a grip on the crisis by the end of 2012, and he ruled out the breakup of the euro.
“I think that in the next 12 months we will have avoided the danger of contagion and will have stabilized the euro zone,” Schaeuble said in an interview published by the newspaper Handelsblatt.