Stocks Extend Year-End Rally, Gold Rises to Record: Markets Wrap
(Bloomberg) — Stocks extended their year-end rally in thin trading, driven by optimism over economic growth and expectations for improved corporate earnings. Gold and silver advanced to records.
The MSCI All Country World Index edged higher, set for a seventh day of gains, while a gauge of Asian stocks climbed 0.2%. US stock-index futures were little changed after the S&P 500 finished Wednesday at a record. Australia, Hong Kong and markets in Europe remain for holidays. Bloomberg’s index of the dollar held near the lowest since October.
Treasuries slipped in Asian hours with the benchmark 10-year yield climbing two basis points to 4.15%. Cash trading closed at 3 p.m. in Tokyo due to a UK holiday, but will resume in New York.
Gold and silver jumped as escalating geopolitical tensions and dollar weakness helped extend a historic rally for precious metals. Spot silver advanced for a fifth day, climbing as much as 4.6% to cross $75 an ounce for the first time. Gold, set for its best annual advance since 1979, rose as much as 1.2% to above $4,500 an ounce.
Equity bulls are pinning their optimism on what’s known as the “Santa Claus Rally” to push stocks to fresh records even as exuberance over artificial intelligence and the Federal Reserve’s interest-rate path are being questioned. The rally is traditionally seen as taking place on the final five trading sessions of a year and the first two of the new one.
“As equity markets enter the fourth year of a bull market, our underlying market call remains constructive,” Scott Chronert, head of US equities strategy at Citigroup Inc., wrote in a note this week. “The current fundamental backdrop clearly has the opportunity for an ongoing AI-related tailwind to large-cap growth.”
The S&P 500 Index gained Wednesday for a fifth day in a shortened session ahead of the Christmas holiday. The VIX index of the S&P 500’s expected volatility fell to the lowest this year.
Risk appetite has been boosted toward year-end even as stronger-than-expected US economic growth data scaled back bets on near-term rate cuts.
After earlier concerns over high valuations for tech stocks amid the AI boom, traders are regaining confidence that companies will deliver solid earnings growth in 2026.
“There were AI-related concerns earlier this month, but those seem to have been digested by the market,” said Tetsuo Seshimo, a portfolio manager at Saison Asset Management in Tokyo.
In commodities, oil headed for the biggest weekly gain since October, as traders tracked a partial US blockade of crude shipments from Venezuela and a military strike by Washington against a terrorist group in Nigeria.
Copper surged to a record in Shanghai and rallied in New York, adding to substantial annual gains as investors bet on tighter global supplies in 2026, while also pricing in the impact of a weaker US dollar.
The yen weakened 0.4% to about 156.44 to the dollar after a report showed Tokyo’s inflation cooled more than expected as pressures from food and energy prices faded. That triggered weakness in the currency on bets the Bank of Japan may push back the timing of its next rate hike.
Meanwhile, China set the yuan’s daily reference rate at a level that was below market estimates by a record margin, in the latest sign of policymakers’ intention to slow the currency’s appreciation.
The move came after the offshore yuan advanced past the psychological level of 7 per dollar on Thursday for the first time since September 2024. The PBOC has steered the yuan toward a path of appreciation to appease Beijing’s trading partners, but has sought to maintain a gradual pace of gains to avoid a surge of hot-money inflows.
Corporate News:
Nvidia Corp. agreed to a licensing deal with artificial intelligence startup Groq, furthering its investments in companies connected to the AI boom. Global green bond and loan issuance has reached a record $947 billion so far this year, according to data compiled by Bloomberg Intelligence. Tesla Inc.’s door handles are facing renewed scrutiny in the US after federal auto safety regulators opened a probe into the emergency releases in certain Model 3 vehicles. The number of small-sized initial public offerings in Japan this year fell to its lowest in more than a decade. Some of the main moves in markets:
Stocks
S&P 500 futures were little changed as of 9:30 a.m. London time Nasdaq 100 futures were little changed The MSCI Asia Pacific Index rose 0.2% The Shanghai Composite rose 0.1% Currencies
The Bloomberg Dollar Spot Index was little changed The euro was little changed at $1.1777 The Japanese yen fell 0.4% to 156.44 per dollar The offshore yuan was little changed at 7.0053 per dollar The British pound fell 0.2% to $1.3488 Cryptocurrencies
Bitcoin rose 0.9% to $88,681.03 Ether rose 0.7% to $2,965.11 Bonds
The yield on 10-year Treasuries advanced two basis points to 4.15% Japan’s 10-year yield was little changed at 2.040% Commodities
Spot gold rose 0.9% to $4,517.87 an ounce West Texas Intermediate crude rose 0.4% to $58.60 a barrel This story was produced with the assistance of Bloomberg Automation.
–With assistance from Matthew Burgess, Aya Wagatsuma and Jake Lloyd-Smith.
©2025 Bloomberg L.P.
