Jeff Randall BBC business editor

Much of the UK market's fizz is back

The FTSE 100 index of leading companies rose by about 8% - hardly a disaster.

But the bounce-back to above 5,000 that the super-optimists were banking on demonstrated the triumph of hope over experience.

Nonetheless, after the battering they had taken since the turn of the millennium, many private shareholders were grateful for any capital gains, however modest.

For them, it was a relief to break the depressing cycle of drooping share prices, savings erosion and pension fund shortfalls.

Leading the stock market into positive territory were some unlikely star performers.

Shell shock

At the start of the year, Shell looked more like a sinner than a winner, after its chief executive, Sir Phil Watts, was forced out amidst a scandal over the booking of reserves that didn't exist.

But, thanks largely to a soaring oil price, up by about one third in 2004, Shell's shares ended the year nearly 30% higher than their low point.

The FTSE 100 is weighted to reflect the market value of its members, which means that when oil giants Shell and BP are doing well, there is a pro-rata positive effect on the index.

Another improbable bringer of glad tidings for investors was the tobacco sector.

Tobacco companies were given a new lease of life in 2004

Given that cigarette companies are facing a worldwide assault from legislators and litigators, who seek to ban smoking in public places while extracting massive compensation for health-damaged smokers, you could be forgiven for thinking that tobacco shares would have less appeal than an overflowing ashtray.

But the stock market doesn't see it that way.

As the cigarette industry continues to consolidate, and new markets open up in developing countries, tobacco companies still possess plenty of puff.

Reflecting this, BAT's shares rose by more than 20% from a 52-week low, and Imperial Tobacco's did even better, climbing by about 35%.

Appetite for growth

It was a year when commodities led the way for profit-hungry investors.

The gold price shot up by more than 40%.

And thanks in part to unprecedented demand from China, where the economy is powering ahead, steel also had a bumper 12 months.

This enabled Corus (formerly British Steel and Hoogevens), which had seemed down and out only two years ago, to scramble back into profit. Corus's shares rose from 29p to 52p.

Our love for coffee still gives a buzz

In the coffee market, bean prices were jumping: up by about 70%.

Not great news for cappuccino addicts, yet this failed to halt the extraordinary expansion of high-street coffee shops in Britain and America.

Doomsters who had said that coffee outlets were at saturation point were confounded in 2004 by the thirst for shares in Starbucks and Caffe Nero.

On New York's Nasdaq exchange, Starbucks' stock price was stronger than a large espresso, steaming up to $63 from $31. In London, Caffe Nero's shares more than doubled to 126p.

Professional bears, stock market players who specialise in spotting overvalued companies, in order to sell the shares ahead of an anticipated sharp fall, will be watching the coffee-shop sector closely for any sign that consumers are becoming "caffeined out".

Ground down?

So much for 2004's bright lights, what were the year's duds?

Well, the curse of the Euro prefix struck again, with both Euro Disney and Eurotunnel enduring a torrid time.

The ousting of a mainly British management team at Eurotunnel by rebel French shareholders, was meant to herald a fresh start at the heavily indebted company.

It didn't work out that way, however, perhaps not surprisingly given that the leader of the dissident investors, Nicolas Miguet, turned out to be a convicted fraudster.

Eurotunnel's French retail investors (the British have all but sold out) seem to be clinging to the belief that governments in London and Paris will eventually be forced to sort out the mess with state aid.

But with Eurotunnel's shares down to 16p from 48p, the stock market is telling us otherwise.

Not so cute

Cuddly didn't cut it with investors

As for Euro Disney, sceptics who insisted all along that the Paris theme park was a Mickey Mouse investment can afford to chuckle at long-term holders.

Euro Disney's shares dropped from 36p to 13p, leaving its supporters feeling decidedly Goofy.

Looking ahead to 2005, few City pundits are expecting share price fireworks.

But, if there is one share price that dealers will be keeping an eye on, it is Marks & Spencer's.

Having rejected Philip Green's proposed 400p-a-share takeover in July, M&S directors must prove that the company is worth more.

With M&S shares now trading at below 350p, the board clearly has much work to do.