S&P 500: The lucky 25

Stock losses this year were broad based and dramatic. But there were a few that escaped the carnage.

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By Ben Rooney, CNNMoney.com staff writer

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Stocks were on a roller coaster in 2008 as investors tried to keep up with bailouts, bankruptcies, a credit crisis and a long recession.

NEW YORK (CNNMoney.com) -- As one of the worst years in Wall Street's history winds down, a notable group of standouts shows investors remained confident in companies that provided consumers with the most bang for their buck.

Among the 25 out of 500 stocks in the S&P 500 ending the year in the black, some 40% are consumer-related. And they run the gamut from well-known names like Wal-Mart and McDonald's to lesser-known firms like UST Inc., which makes smokeless tobacco products and wine.

"If there is one pattern we can discern, it's that investors have been buying stocks that they think will benefit from people moving down the buying ladder," said Brian Gendreau, an investment strategist at ING Investment Management in New York. "People have to buy certain consumer staples, whether or not we're in a recession."

That comes against a grim backdrop. The overall index is down nearly 38.5% from the start of the year -- its worst annual performance since an earlier version of the S&P fell 47% in 1931.

This year's losses have been broad based, with all S&P 500 sectors showing double-digit percentage losses, including a staggering 58% retreat for the financial sector.

Stocks in the materials sector are down 47.8% for the year, and information technology stocks were off 44.2% as of Wednesday's close.

But the consumer staples sector, which includes some of this year's best performing stocks, is down a comparatively benign 18.3%. And while the consumer discretionary sector is down 35.7%, it includes seven of this year's best performers.

Indeed, discount retailer Family Dollar Stores (FDO, Fortune 500) is on track to become the S&P 500's top stock of the year. As of Wednesday, its stock was up 38.5% year to date.

Other consumer-related stocks posting significant gains include the world's largest retailer, Wal-Mart Stores (WMT, Fortune 500), which is up nearly 18% for the year, and fast-food giant McDonald's (MCD, Fortune 500), which has advanced 5.6%. These blue chip stocks are also the only two Dow components posting gains this year.

And if there's one stock that shows vices are recession proof, it's UST. Shares of UST Inc. (UST) are up 26.6% this year and are ranked as the S&P 500's second-best performing stock of the year.

Meanwhile, biotech and biopharmaceutical firms also fared well this year.

Shares of biotechnology company Amgen Inc. (AMGN, Fortune 500) are up 24.3% for the year. Celgene Corp. (CELG), which makes the cancer and leprosy drug Revlimid, gained 19.6%.

And, while the nation's auto industry has been teetering on the verge of bankruptcy, shares of AutoZone (AZO, Fortune 500), an auto parts and accessories retailer, have gained nearly 16.3% this year.

Finally, tax consulting firm H&R Block (HRB) is another stock that has done well despite a difficult environment. Its stock is up more than 23.3% this year.

While 2008 will go down as one of the most painful years on record, some analysts think now may be the time to start buying again.

"The market has already been showing signs of a bottom," Gendreau said. And stocks could get a boost from a "massive fiscal stimulus" when the Obama administration takes office next year, he added.

"If you wait until you see concrete signs of recovery in the economy, you've probably already missed most of the rally," said Gendreau. To top of page

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