Lacklustre ASX ends the year below global markets
The Australian sharemarket has not performed as well as those in many developed countries in 2025.
By Staff writers
Updated January 1, 2026 — 9.05am
The Australian sharemarket ended its last trading day of 2025 on a muted note with the key S&P/ASX 200 index tracking towards a 6.3 per cent gain for the year – its worst performance since a loss in 2022.
The sharemarket’s marginal gains were far below the stock markets of most other developed countries. Global stocks are poised for their biggest annual gain in six years, supported by US Federal Reserve interest rate cuts and a surge in enthusiasm for artificial intelligence companies.
Wall Street also had a lacklustre final session for the year. The S&P 500 pulled back 0.7 per cent on New Year’s Eve, while the Dow Jones Industrial Average lost 0.6 per cent, and the Nasdaq composite gave back 0.8 per cent.
Wall Street had a relatively quiet session as the year came to a close.Credit: Bloomberg
Wall Street’s S&P500 index gained 16.7 per cent in 2025, while similar indices for Britain, Japan, Germany, Canada and Hong Kong all climbed by more than 20 per cent. The MSCI All Country World Index – one of the broadest measures of the equity market – surged 21 per cent for the year. Among the few markets the ASX 200 outperformed is New Zealand’s, where the NZ50 rose 3.7 per cent.
In local trading, the S&P/ASX 200 closed down 2.8 points at 8714.30 on Wednesday as the market finished trade early for New Year’s Eve. It remains closed on New Year’s Day.
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Six of the 11 industry sectors were in positive territory by day’s end. The local bourse’s lacklustre session followed two days of modest declines in light holiday trading. The Australian dollar was trading for US66.97¢ at mid-afternoon on Wednesday.
Energy and mining stocks showed the biggest daily gain as oil prices steadied and gold, silver and copper resumed their ascent after steep declines a day earlier.
Gold miners Northern Star Resources, Evolution Mining and Newmont rebounded from Tuesday’s losses and were up 1.7 per cent, 1 per cent and 0.7 per cent respectively. South 32, which owns Australia’s biggest silver mine, added 1.1 per cent.
Silver and gold bounced back after plunging below all-time highs on Monday when the Chicago Mercantile Exchange, one of the largest trading floors for commodities, asked traders to put up more cash to make bets on precious metals. Prices for both metals have surged in 2025 on a mix of economic worries and supply deficits.
Back home, mining giant BHP, which is pivoting to copper to broaden its earnings base beyond iron ore, which has seen demand peak, added 0.9 per cent. Copper rose 3.7 per cent and is up more than 40 per cent for the year on strong demand. The base metal is critical to global energy infrastructure, and demand is expected to keep growing as the development of artificial intelligence technology puts more of a strain on data centres and the energy grid.
Oil and gas heavyweights Woodside and Santos rose 0.9 per cent and 1 per cent, respectively.
On Wall Street on New Year’s Eve, traders closed out another banner year for stocks with a downbeat finish that extended the market’s recent losing streak to a fourth day.
Trading volume was very thin ahead of the New Year’s Day holiday, when markets will be closed, as most big investors had already closed out their positions for the year.
Strong profit reports from companies and three cuts to interest rates by the Federal Reserve had helped the US market push higher in 2025.
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Still, the AI frenzy did not come without concerns. Chief among them is the worry that artificial intelligence technology may not produce enough profits and productivity to make all the investment worth it. That could keep the pressure on AI stocks like Nvidia and Broadcom, which were responsible for much of the market’s gains this year.
And it’s not just AI stocks that critics say are too pricey. Stocks across the US market still look expensive after their prices climbed faster than profits.
On top of concerns that stocks are overvalued, the ongoing impact of Trump’s trade war threatens to add more fuel to inflation in the world’s largest economy. Despite the Fed cutting rates over concerns about the labour market, inflation remains solidly above the central bank’s 2 per cent target.
Wall Street is betting that the Fed will hold interest rates steady at its next meeting in January.
Traders got an update on the state of the job market on Wednesday. The US Labor Department reported that fewer Americans applied for unemployment benefits last week with layoffs remaining low despite a weakening labour market.
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All sectors in the S&P 500 were in the red in the year’s final session, with technology stocks among the biggest drags on the market.
Treasury yields were mostly higher in the bond market. The yield on the 10-year Treasury rose to 4.16 per cent from 4.13 per cent late on Tuesday. The yield on the two-year Treasury, which moves more closely with expectations for what the Federal Reserve will do, rose to 3.47 per cent from 3.45 per cent.
Trading in precious metals continued to be volatile as the year wound down. Silver swung back to a big loss, giving back 9.1 per cent after Tuesday’s gain of more than 10 per cent. Following Friday’s 7.7 per cent jump, silver lost nearly 9 per cent on Monday. It still gained 140 per cent in 2025.
Gold was down 1.2 per cent, but is still up about 64 per cent for the year.
US benchmark crude slipped 0.7 per cent to $US57.55 per barrel. The price of Brent crude, the international standard, fell 0.6 per cent to $US60.97 per barrel.
AP, with AAP and Bloomberg
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