Stocks end a strong 2016 on a weak note

Investors capped a year of solid gains on Wall Street in a selling mood Friday, sending the major U.S. stock indexes modestly lower on the final trading day of 2016.

Technology and consumer-focused stocks led the broad slide, while real estate companies and banks eked out small gains. As it had been for much of the week, trading was subdued as the New Year’s Day holiday neared.

Despite riding out the last week of the year with losses, halting the Dow Jones industrial average’s momentum as it neared the 20,000 mark, 2016 delivered a much better finish for stock investors than most would have anticipated.

All told, the Dow ended the year with a 13.4% gain, while the Nasdaq composite was up 7.5%.

The Standard & Poor’s 500 index, the broadest measure of the stock market, gained 9.5% after an essentially flat finish in 2015. Including dividends, the total return was 11.96%.

Small-company stocks fared the best, especially since the election. The Russell 2000 index closed out 2016 with a gain of 19.5%.

“This was not just a market that did well, it did extremely well,” said Quincy Krosby, market strategist at Prudential Financial.

The stock market weathered repeated slumps in 2016, including the worst start to any year for stocks, the second correction for the market in five months and plummeting oil prices. A steadily improving U.S. economy and job market, as well as more stable oil prices and better company earnings growth, helped turn the market around. More recently, investor optimism after Republicans swept the November election kicked off a rally that sent the market to new heights.

Some of that enthusiasm evaporated in the final week of the year, as traders seized on the quiet period between the Christmas and New Year’s holidays to do some selling to lock in profits.

“So many times we look for a rally at the end of the year, particularly between Christmas and New Year’s,” said J.J. Kinahan, TD Ameritrade’s chief strategist. “But with the incredible up move we’ve had since the election, people are either hesitant to buy things heading into the new year or are taking a little bit of profit.”

On Friday, the Dow slid 57.18 points, or 0.3%, to 19,762.60. The S&P 500 index fell 10.43 points, or 0.5%, to 2,238.83. The Nasdaq composite declined 48.97 points, or 0.9%, to 5,383.12.

The Russell 2000 retreated 6.05 points, or 0.4%, to 1,357.13.

Bond prices rose. The yield on the 10-year Treasury note fell to 2.44% from 2.48%.

Global stocks mostly rose on the year’s last day of trading.

Britain’s index rallied to hit another all-time high. The FTSE 100, which was trading for only a half day, rose 0.3%. That put the index up 14.4% in 2016.

Germany’s DAX rose 0.3%. France’s CAC 40 gained 0.5%. Japan’s Nikkei 225 fell 0.2%, while Hong Kong’s Hang Seng index rose 1%.

Benchmark U.S. crude fell 5 cents to $53.72 a barrel; that translates into a 45% gain for the year. Brent crude, used to price international oils, slipped 3 cents to close at $56.82 a barrel.

Wholesale gasoline fell 2 cents to $1.67 a gallon. Heating oil held steady at $1.70 a gallon. Natural gas futures fell 7.8 cents, or 2.1%, to $3.72 per 1,000 cubic feet.

Gold fell $6.40 to $1,151.70 an ounce. Silver slid 23 cents to $15.99 an ounce. Copper rose 2 cents to $2.51 a pound.

The dollar strengthened to 116.78 yen from 116.65 yen. The euro rose to $1.0531 from $1.0485.

UPDATES:

3:25 p.m.: This article was updated with the figure for the S&P 500’s total return in 2016.

3:05 p.m.: This article was updated with full-year market information, context and analyst comments.

1:25 p.m.: This article was updated with the close of markets.

7:40 a.m.: This article was updated with more recent market information.

This article was originally published at 6:55 a.m.