(CNN) - Global stocks have closed out a dreadful year with a whimper, signaling more potential declines in 2019.
Markets around the world have been battered by the trade conflict between the United States and China, fears over rising interest rates and geopolitical snafus like Brexit. As the year draws to a close, few issues have been resolved.
The FTSE All-World index, which tracks thousands of stocks across a range of markets, plummeted 12% this year. It's the index's worst performance since the global financial crisis, and a sharp reversal from a gain of nearly 25% in 2017.
Analysts see even more trouble ahead. Neil Shearing, chief economist at Capital Economics, warned recently that the economic outlook for next year is "more challenging" and that weaker growth is likely to have "significant implications for financial markets."
"We expect global equity markets to struggle again next year, with US stocks likely to experience the steepest declines," he wrote in a research note.
The trouble in Asia
The market damage this year was most pronounced in China, where the world's second largest economy is feeling the effects of a darkening trade outlook and government attempts to rein in risky lending after a rapid rise in debt levels.
The Shanghai Composite entered a bear market in June and has now declined nearly 25% since the start of the year. The Shenzhen Composite, which includes many of the country's tech firms, dropped by more than 33% over the same period. In Hong Kong, the Hang Seng is down 14%.
The economic hit from the trade war is expected to become more pronounced in the coming months, hurting Chinese exports and corporate profits. What remains uncertain is the severity of the slowdown and how far the Chinese government will go in trying to soften the impact.
Stocks elsewhere in Asia, including Japan and South Korea, have not been spared.
Frankfurt's DAX has declined more than 18% since January. German carmakers have been hit especially hard by trade war fears and new emissions tests.
The main stock market in Milan, Italy, has slumped 16% amid worries over spending plans proposed by the country's populist government.
Spain's IBEX has dropped 15%, and France's CAC 40 is down 11%.
Looking ahead to 2019, Brexit remains a major risk for Europe. British stocks could take a hit if the United Kingdom leaves the European Union without a deal, but foreign companies doing business in the country could also be affected.
Pain on Wall Street
While annual losses may not be as steep as in some other markets, Wall Street is in an historic period of volatility. The S&P 500 was up or down more than 1% nine times in December and 64 times this year. In all of 2017, that happened only eight times.
The big winners
There were a handful of major global markets that turned in decent performances in 2018.
Jethro Mullen and Daniel Shane contributed reporting.
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