Late November saw some big one-day swings in share prices, on a range of slightly odd pieces of news. For example, there was a marked rally following the announcement that the beleaguered Citigroup would raise new capital by selling shares to the government of Abu Dhabi.

More routine were comments from a member of the Federal Reserve Board that an interest rate cut was imminent, which saw the Dow shoot up for its highest one-day gain in four and a half years.

But for every piece of good news there seemed to be a bad one too. Increasing concerns about mortgage defaults and the state of the housing market saw UBS downgrade America's two biggest mortgage lenders, Freddie Mac and Fannie Mae, in late November. This of course knocked-on to shares in housebuilders, as well as denting the confidence of the wider market.

So in short, the markets had a real roller-coaster ride as the year drew to a close. Our graph shows the position for the 12 months from the start of December 2006, and the sharp fall followed by recovery of the most recent few weeks is plain to see, particularly in the ACT Heavy Equipment Index (HEI).

But considering all the difficulties of 2007, particularly the waves of bad news from the banking sector, the markets look like finishing the year in reasonable shape.

For the 12 months to the start of December, all four of the Indexes ACT monitors were in the black. Particularly impressive was the ACT HEI, which was up just over +40% on the position a year previously.

Some way below these were the three mainstream indexes, with the NASDAQ and Dow fairly even, up just under 10% for the year to date. More distant was the S&P 500, up about 5.5% compared to December 2006.

Heavy equipment

The striking out-performance of the Heavy Equipment sector emphasises the underlying strength in fundamental markets like construction and mining. Yes, the residential sector is in trouble, and this is reflected in shares of light equipment manufacturers like Gehl, which have lost more than half their value since the summer.

On the other hand, the likes of Bucyrus, CNH, Deere and Manitowoc saw their shares hit record highs in the last quarter of 2007, despite the months of bad news form the banking sector.

This is also a function of the fact that most of the companies that make up the HEI are genuinely international players in the heavy equipment sector. The lighter end of the US building market may be in decline at the moment, but these equipment manufacturers are reaping the rewards of construction and mining markets that are booming absolutely everywhere else in the world.

Full-year financials will be viewed with keen interest when the results season gets into full swing at the end of January, and in the run-up to this, there may be more violent swings in share prices as investors' nerves are further tested.

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