US stocks closed the final full trading week of 2025 on a positive note, snapping a recent losing streak as easing inflation concerns and renewed confidence in artificial intelligence lifted investor sentiment. A late-week rally helped major indices recover earlier losses, keeping hopes alive for a year-end “Santa Claus rally.”
Stocks Finish Strong Despite Choppy Week
On Friday, the S&P 500 rose 0.8%, while the Nasdaq Composite jumped more than 1.3%, led by gains in technology stocks. The Dow Jones Industrial Average added 0.3%.
For the week, the S&P 500 and Nasdaq posted modest gains of 0.1% and 0.4% respectively, while the Dow slipped 0.6%. The rebound came after investors digested delayed economic data releases, including November jobs and inflation reports, which reinforced expectations that interest rate cuts remain possible next year.
A softer inflation outlook combined with signs of a cooling labour market has revived optimism around the Federal Reserve’s easing cycle. While traders are still largely pricing in two rate cuts in 2026, bets have increasingly shifted toward the possibility of more.
AI Trade Back In Focus, Tech Stocks Rally
Technology stocks powered the late-week recovery as concerns around the AI trade eased. Oracle shares surged after reports that China’s ByteDance signed deals to form a US TikTok joint venture involving Oracle, following a turbulent period for the stock.
Nvidia also added momentum after a Reuters report said the US government is reviewing potential approvals for sales of its H200 AI chips to China, boosting confidence in sustained global demand for AI hardware.
CoreWeave shares surged 20% on Friday, rebounding from sharp losses earlier in the month. The rally followed Citi’s decision to resume coverage of the stock and reports that OpenAI is seeking up to $100 billion in funding, potentially valuing the AI firm at $830 billion.
Healthcare Stocks Rise On Trump Administration Deals
Pharmaceutical stocks outperformed after President Donald Trump announced pricing agreements with nine drugmakers. The deals offer a three-year pause on potential tariffs in exchange for commitments to lower drug prices in the US.
Shares of Merck, Bristol Myers Squibb, Gilead Sciences, Amgen, and Novartis all moved higher following the announcement. The agreements include reduced Medicaid pricing, discounts for cash buyers, and commitments to launch new medicines domestically at prices comparable to international markets.
Bonds, Inflation Data, Rate Expectations
Bond markets were active as global yields responded to the Bank of Japan’s interest rate hike, the highest since 1995. The US 10-year Treasury yield rose to around 4.15%.
Investors are now awaiting final December consumer sentiment data from the University of Michigan after an initial survey showed confidence improving for the first time in five months.
US stock markets will remain open on December 24 and 26, despite President Trump ordering federal government offices to close on those days.
Commodities Shine As Gold, Silver Near Records
Precious metals extended their strong run. Gold futures traded near record highs around $4,380 per ounce, while silver jumped roughly 3% to trade above $67 per ounce.
Gold is up more than 60% year-to-date, while silver has surged 125%, supported by expectations of looser monetary policy and a weaker US dollar.
Bitcoin Stuck In Tight Range
Bitcoin hovered near $87,000 throughout the week, remaining largely unchanged over the past five days. Strategists believe the cryptocurrency is likely to stay rangebound in the near term as investors await clearer signals from inflation data, interest rates, and broader risk sentiment.
North Korea’s Crypto Theft Reaches Record Levels
Cybersecurity concerns also remained in focus after new data revealed that North Korean hackers stole more than $2.02 billion in cryptocurrency in 2025, according to blockchain analytics firm Chainalysis.
The thefts represent a more than 50% increase from 2024 and bring the regime’s total identified crypto theft since 2016 to $6.75 billion. Officials say the stolen funds are linked to financing North Korea’s weapons programs.
Consumer and Retail Pressures Persist
Not all sectors shared in the rally. Nike shares fell 9%, dragging down other footwear stocks, including Deckers Outdoor, On Running, and Crocs. Concerns around slowing demand and margin pressure continued to weigh on consumer discretionary stocks.
Markets closed the week with renewed optimism, driven by easing inflation fears, revived AI momentum, and policy clarity in healthcare. However, mixed signals from bonds, consumer stocks, and crypto suggest investors remain cautious as they head into year-end trading and position for 2026.
