Asian markets end 2025 with cautious optimism after a volatile year
Asian markets closed out 2025 with mixed results on the final trading day of the year. Some indices showed small gains, while others dipped slightly as investors wrapped up a volatile but largely positive 12 months in the stock market today. The session saw light trading, with many traders away for the holiday period.
Earlier in the day, Shanghai and Taipei opened with modest gains. Meanwhile, Hong Kong and Australia edged lower, reflecting cautious sentiment. The uneven performance came after China reported a slight uptick in factory activity for December, offering a glimmer of optimism for the region’s economic outlook.
Across the Pacific, Wall Street’s main indices closed marginally down on Tuesday. Concerns over AI stock valuations weighed on investor confidence, though US markets remained on course for strong annual gains in the stock market. The Federal Reserve’s decision to ease monetary policy in the second half of 2025 had already lifted global markets, contributing to sharp rises in Asia—Seoul’s Kospi surged over 75% for the year, while Tokyo’s Nikkei 225 climbed more than 26% in the stock market. In commodities, gold and silver retreated from record highs reached earlier in the week. After a steep pullback, prices stabilised, though they remained well above levels seen at the start of the year. The Fed’s latest projections, released after its December 10 meeting, signalled a median federal funds rate of 3.4% for 2026—implying one further cut from the current 3.50%-3.75% range in the stock market.
The year ended with markets in a holding pattern, as thin holiday trading limited major moves. Despite the day’s mixed results, 2025 proved a strong year for equities, supported by central bank policies and economic recovery signs in the stock market today. Investors now look ahead to 2026, with the Fed’s rate outlook shaping expectations for the months to come.
