New York (AFP) - Stock markets mostly retreated Wednesday in thin trading, following a year of record gains for key assets as central banks cut interest rates and the tech sector boomed thanks to the growth of artificial intelligence.

Wall Street’s main indices dipped to close the final trading day of 2025, with little fresh economic data apart from a drop in both first-time and continuing claims for jobless benefits in recent weeks.

Still, all three indices logged solid gains for the full year.

The Dow added 13 percent in 2025, the broad-based S&P 500 advanced 16.4 percent and the tech-focused Nasdaq Composite surged 20.4 percent over the year.

“Generally speaking, 2025 was a spectacular year for equities,” said Briefing.com analyst Patrick O’Hare.

Across the globe, stock markets struck record highs and enjoyed double-digit gains in 2025, thanks in large part to interest rate cuts from the US Federal Reserve following drops in inflation.

London’s benchmark FTSE 100 index jumped more than 21 percent in 2025 – the biggest gain for 16 years.

Frankfurt rallied 23 percent in 2025, while Paris saw an annual gain of more than 10 percent.

In Asia, Seoul stocks rocketed 75 percent higher, while Hong Kong’s Hang Seng index jumped 28 percent, and Tokyo’s Nikkei 225 won more than 26 percent.

“To push meaningfully higher in 2026, equities will need confirmation that the Fed can deliver at least the two rate cuts still priced by the market, with growth unimpeded,” noted Stephen Innes of SPI Asset Management.

Minutes of the Fed’s policy meeting in December, which were released on Tuesday, indicated that most of its officials see future rate cuts as appropriate, should inflation cool over time as expected.

A surge in the tech sector on the back of the vast amounts of cash pumped into AI also helped push stocks to record highs, but concerns that valuations of AI stocks are too high gnawed at investors late in 2025.

AI chip juggernaut Nvidia became the world’s first $5 trillion company at the end of October, while its current worth stands at around $4.5 trillion.

The price of gold, seen as a safe haven investment, scored multiple record highs this year.

The precious metal has benefitted from weakness to the dollar caused by the Fed’s rate cuts and economic growth concerns triggered by President Donald Trump’s tariffs war.

On Wednesday, the price of silver slid further having struck record highs in December.

Oil prices have retreated nearly 20 percent over the year, pressured by an oversupplied market.

Bitcoin, emphasizing the volatile nature of the cryptocurrency sector, soared to a record high above $126,000 in October before ending the year around $88,000.

- Key figures at around 2105 GMT -

New York - Dow: DOWN 0.6 percent at 48,063.29 points (close)

New York - S&P 500: DOWN 0.7 percent at 6,845.50 (close)

New York - Nasdaq Composite: DOWN 0.8 percent at 23,241.99 (close)

London - FTSE 100: DOWN 0.1 percent at 9,931.38 (close)

Paris - CAC 40: DOWN 0.2 percent at 8,149.50 (close)

Frankfurt - market closed for holiday

Hong Kong - Hang Seng Index: DOWN 0.9 percent at 25,630.54 (close)

Shanghai - Composite: UP 0.1 percent at 3,968.84 (close)

Tokyo - market closed for holiday

Euro/dollar: DOWN at $1.1750 from $1.1774 on Tuesday

Pound/dollar: DOWN at $1.3478 from $1.3503

Dollar/yen: UP at 156.66 yen from 156.00 yen

Euro/pound: UP at 87.18 pence from 87.15 pence

Brent North Sea Crude: DOWN 0.8 percent at $60.85 per barrel

West Texas Intermediate: DOWN 0.9 percent at $57.42 per barrel

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