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Week Ended December 2, 2011

Investor sentiment swung dramatically from despair back to hope, helping drive the best weekly gain for the major averages since the market recovery began in March 2009. Gains among smaller-cap shares were even stronger, with the Russell 2000 Index rising by over 10%. Reports of strong sales over the "Black Friday" weekend started the week off on a strong note. Purchases on the important shopping day after Thanksgiving were up by 6.6%, according to one tally, helping to offset more lackluster retail sales earlier in the month. News of concerted action to stem the European banking crisis drove even stronger gains on Wednesday, sending the broad S&P 500 Index up by over 4.3%. Many of the world's leading central banks announced plans to provide low-cost loans of U.S. dollars to European banks in order to head off tightening liquidity in the region. Investors were also encouraged by a reversal in Chinese monetary policy. The Chinese central bank lowered the reserve requirements for the nation's banks, indicating that growth was supplanting inflation as the central concern of Chinese policymakers. Signs of further improvement in the U.S. labor market also helped drive gains in the week. On Wednesday, the payroll processing firm ADP announced a solid rise in its tally of monthly private sector job gains. The official count from the Labor Department on Friday was not quite as large, but the government also announced a steep drop in the unemployment rate, from 9.0% to 8.6%. Much of the other economic data released during the week also suggested the U.S. was weathering the troubles in Europe better than many economists had expected. Indicators pointed to continued expansion in the manufacturing sector, pending home sales in October jumped to their highest level of the year, and an index of consumer sentiment hit its highest level since early in the summer.

U.S. Stocks¹
Index²	Friday's Close	Week's Change	% Change Year-to-Date
DJIA	12019.42	787.48	3.82%
S&P 500	1244.28	85.61	-1.06%
NASDAQ Composite	2626.93	185.35	-0.98%
S&P MidCap 400	881.19	68.73	-2.87%
Russell 2000	734.74	68.28	-6.43%

This chart is for illustrative purposes only and does not represent the performance of any specific security. Past performance cannot guarantee future results.

¹Source of data Reuters, obtained through Yahoo! Finance Closing data as of 4:10 p.m. ET.

²The Dow Jones Industrial Average and the Standard & Poor's 500 Stock Index of blue chip stocks, the Standard & Poor's MidCap 400 Index, and the Russell 2000 Index are unmanaged indexes representing various segments by market capitalization of the U.S. equity markets. The Nasdaq Composite is an unmanaged index representing the companies traded on the Nasdaq stock market and the National Market System.

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U.S. Bond Market

Week Ended December 2, 2011

An agreement among major central banks to act in concert to mitigate Europe's debt crisis surprised the financial markets, driving long-term U.S. Treasury yields higher during the week. The two-year yield closed a bit lower than its level of a week earlier. The consortium of banks included the U.S. Federal Reserve; the European Central Bank; the Bank of Japan; and the central banks of Britain, Canada, and Switzerland. The news was welcomed by investors, who had been disappointed by lackluster efforts to deal with major debt issues here and abroad during the past few months. Good news on the U.S. employment front also encouraged investors, when the Labor Department reported on Friday that the unemployment rate fell from 9.0% in October to 8.6% in November, the lowest level in two-and-a-half years. In addition, manufacturing picked up in November, led primarily by gains in production. All in all, the week provided positive economic news following a long stretch of discouraging data on the housing and labor markets.

U.S. Treasury Yields¹
Maturity	December 2, 2011	November 25, 2011
2-Year	0.25%	0.27%
10-Year	2.03%	1.96%
30-Year	3.02%	2.92%

This table is for illustrative purposes only. Past performance cannot guarantee future results.

¹Source of data: Bloomberg.com, as of 4 p.m. ET Friday, December 2, 2011.

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International Market

Week Ended November 25, 2011

International Stocks

Foreign stock markets closed lower for the week ending November 25, 2011 with the broad international measure, the MSCI EAFE Index (Europe, Australasia, and Far East), losing -5.62%.


Region/Country	Week's Return	% Change Year-to-Date
EAFE	-5.62%	-17.53%
Europe ex-U.K.	-6.81%	-20.91%
Denmark	-4.59%	-20.13%
France	-6.38%	-22.50%
Germany	-7.02%	-21.43%
Italy	-9.35%	-26.66%
Netherlands	-6.35%	-20.60%
Spain	-8.25%	-17.95%
Sweden	-8.40%	-25.23%
Switzerland	-5.59%	-14.13%
United Kingdom	-5.48%	-10.10%
Japan	-2.89%	-17.60%
AC Far East ex-Japan	-4.90%	-18.46%
Hong Kong	-3.46%	-19.44%
Korea	-5.53%	-15.74%
Malaysia	-2.46%	-7.12%
Singapore	-4.83%	-19.78%
Taiwan	-6.65%	-24.49%
Thailand	-3.49%	-8.63%
EM Latin America	-8.22%	-24.44%
Brazil	-8.20%	-26.25%
Mexico	-8.69%	-19.29%
Argentina	-6.60%	-40.52%
EM (Emerging Markets)	-6.05%	-21.74%
Hungary	-8.36%	-34.80%
India	-5.73%	-34.70%
Israel	-9.54%	-32.25%
Russia	-5.84%	-17.53%
Turkey	-8.55%	-35.51%

International Bond Markets

International bond markets in developed countries were lower this week, with the J.P. Morgan Global Government Bond Less U.S. Index losing -2.38%.


Region/Country	Week's Return	% Change Year-to-Date
Developed Markets	-2.38%	3.42%
Europe
Denmark	-1.67%	9.37%
France	-2.95%	-1.25%
Germany	-3.08%	5.38%
Italy	-5.51%	-12.56%
Spain	-3.38%	-3.98%
Sweden	-1.90%	8.49%
United Kingdom	-1.73%	13.12%
Japan	-1.42%	6.28%
Emerging Markets	-1.17%	6.74%
Argentina	-5.67%	-18.41%
Brazil	-0.18%	11.37%
Bulgaria	-0.51%	1.19%
Russia	-1.40%	5.18%

International Currency Markets

On the currency front, the U.S. dollar was stronger against the major currencies for the week.


Currency	Close (November 25, 2011)	Week's Return (U.S. $)	% Change Year-to-Date (U.S. $)
Japanese yen	77.680	1.00%	-4.41%
Euro	1.3269¹	1.88%	1.09%
British pound	1.5484¹	1.93%	1.10%

¹U.S. dollars per national currency unit.

Sources: Foreign stock markets and currency sections are from Rimes Technologies, using MSCI data. International bond markets are from J.P. Morgan.

Note: All returns are in U.S. dollars. All bond indices are J.P. Morgan. All stock indices are Morgan Stanley Capital International (MSCI).

Equity Indices
EAFE:	MSCI Europe, Australasia, and Far East Index
Europe Ex-U.K.:	MSCI Europe ex-U.K. Index
Far East Ex-Japan:	MSCI AC Far East ex-Japan Index
Latin America:	MSCI Emerging Markets Latin America Index
Emerging Markets:	MSCI Emerging Markets Index

Bond Indices
Developed Markets:	J.P. Morgan Global Government Bond Less U.S. Index
Emerging Markets:	J.P. Morgan Emerging Markets Bond Index Plus

All charts are for illustrative purposes only and do not represent the performance of any specific security. Past performance cannot guarantee future results.