US-listed shares of overseas companies finished 2011 with double-digit losses on Friday in the worst yearly performance since 2008, with Latin American ADRs among the biggest losers. The BNY Mellon index of leading American Depository Receipts posted losses for 2011 of 14.6 percent, compared with a loss for the Standard & Poor's 500 index of just 0.003 percent for the year.
The index of leading Latin American ADRs ended down 22.7 percent for the year, worse than indexes for other regions, although Asian ADRs were down a steep 20 percent. European banks were hit especially hard by concerns over fallout from the region's debt crisis, with shares of Deutsche Bank ending the year down 27.3 percent.
Among Latin American ADRs, commodity-related shares were among the worst hit. Brazilian oil company Petrobras, finished down 34.3 percent for the year, and shares of Brazilian miner Vale ended down 38 percent. Investors shunned riskier assets this year as uncertainties about the global economy grew, particularly because of the debt problems in Europe.
"The most economically sensitive stocks are going down over economic worries, and even though the problems have not really spread to Latin America, a greater proportion of Latin American ADRs are commodity plays. And commodities are what really get hurt in a world-wide economic downturn, particularly energy-related commodities and metals," said Bryant Evans, who runs the ADR Cozad Asset Management International Equity Income Portfolio for Cozad Asset Management, in Champaign, Illinois.
Brent crude oil still ended the year up 13 percent. Evans said he is overweight Latin America in his portfolio, saying that many of those stocks "are looking like real values." Among his holdings are shares of Ultrapar, Sabesp and Tenaris. With other leading ADR indexes, the BNY Mellon index of leading European ADRs ended down 10.3 percent for the year, while the BNY Mellon index of leading Asian ADRs ended down 20.3 percent.
"European stocks have kind of rebounded a little bit from their lows, more so than other international holdings," Evans said. He noted that he's just added Spain's Banco Santander to his holdings. Banco Santander is down 29.4 percent for the year. The FTSEurofirst 300 index of top European shares fell 10.7 for 2011, the most since 2008.