2025 Stock Market Recap: A Historic Year for Investors
Recapping the huge year in the stock market and economy, in this week’s Fastest 4 Minutes in Finance.
It’s the final week of 2025, and it is always so hard to believe that another year has passed. For the third straight year, the S&P 500 is on track to post double digit gains. That has only happened 8 times in the past 100 years. In four of those 8 times, the Index was higher a 4th straight year.
AI and Tariffs: The Two Forces That Drove 2025 Markets
As we look back on 2025, there were two dominant factors that drove market performance: Artificial Intelligence, and tariffs. The optimism over AI pushed the biggest companies higher, while President Trump’s April announcement of sweeping global tariffs pushed the investor panic button briefly. But, those weren’t the only notable happenings. LPL Research gives us 3 others that stand out.
Global Stock Markets Outperform the U.S. in 2025
First, it wasn’t just the United States getting in on the party. The foreign equity market was even better. Take a look at this chart.
It compares the returns of the MSCI All Country World Index minus the U.S. to the Russell 3000, which is a benchmark for the entire U.S. stock market.
Over the past 15 years, the U.S. has outperformed foreign markets in 12 of them. But, in 2025, the foreign markets outperformed the U.S. market by 15%, almost doubling it. A major drive of this was weakness of the U.S. dollar.
Federal Reserve Rate Cuts and the 10-Year Treasury Yield
Number 2: oddities among interest rates. The Fed cut rates three times late this year, trimming the target range to 3.5% to 3.75%. Long term rates have held steady though. The 10-year Treasury yield is still above 4%.
In fact, the Fed has cut the short-term rate by 1.75% since late 2024, but the 10-year Treasury has risen nearly half a percent since then.
Gold, Silver, and Oil: A Tale of Two Commodities
And finally, a tale of two commodities. Two precious metals soared to record highs in 2025. Gold is up nearly 64% year-to-date at the time of this recording, and silver has more than doubled, shooting up 122%.
Oil, on the other hand, fell below $60 per barrel in December, after starting the year above $73.
Why Gold Surged and Oil Fell in 2025
LPL notes a softer dollar, declining real yields, and central bank demand drove gold higher. The Research Team believes pullbacks in gold will happen next year, but could be seen as a buying opportunity. Central government demand will stay high.
With oil prices, swelling global inventory has outpaced modest demand. Heading into 2026, OPEC is expected to make production pauses that could stabilize prices, but slower global growth, particularly in China could stunt a meaningful rebound.
2026 Market Outlook Webinar Invitation
For a more in-depth look at what may happen next year, join us for an Outlook 2026 webinar, coming in January.
Securities are offered through LPL Financial, Member FINRA/SIPC. GenWealth Financial Advisors is an other business name of Independent Advisor Alliance, LLC. All investment advice is offered through Independent Advisor Alliance, LLC, a registered investment adviser. Independent Advisor Alliance, LLC is a separate entity from LPL Financial.
