Asian stocks edged lower on the final trading day of the year, capping a period in which investors largely looked past tariff-related uncertainty and instead focused on the powerful rally in artificial intelligence chip stocks. With Japanese markets closed for the remainder of the week and many global exchanges shut for the New Year holiday, trading volumes were thin and price movements subdued.
MSCI’s broadest index of Asia-Pacific shares outside Japan slipped 0.17% on Wednesday but is still set to post a robust 27% gain for the year, its strongest performance since 2017. The rally was driven primarily by semiconductor stocks benefiting from surging demand linked to AI adoption. China’s blue-chip index inched higher and is on track for an 18% annual rise, while Hong Kong’s Hang Seng dipped 0.7% on the day but is poised to deliver an impressive 28% gain for the year as investors shrugged off trade war concerns.
South Korea stood out as the world’s best-performing major equity market, with the Kospi soaring 76% over the year, led by heavyweight chipmakers SK Hynix and Samsung. Analysts noted that despite geopolitical tensions, tariff wars, and policy uncertainty, global markets delivered exceptional returns, albeit with gains concentrated in specific sectors such as AI and technology.
Precious metals were another major theme. Silver captured headlines with an extraordinary rally, pushing its yearly gains beyond 160%, though prices dipped slightly as traders took profits. Gold also firmed and is on track for a 66% surge in 2025, extending a three-year rally fueled by inflation hedging, central bank demand, and investor appetite for safe-haven assets.
In currency markets, the U.S. dollar faced its worst year since 2017, down 9.4%, allowing the euro and British pound to record strong annual gains. Meanwhile, oil prices fell more than 10% in 2025, with Brent crude heading for its longest streak of annual losses as global supply outpaced demand despite ongoing geopolitical conflicts.
Looking ahead, investors remain focused on the Federal Reserve’s interest rate path and the sustainability of crowded trades in AI stocks and precious metals as markets move into 2026.


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