Post by : Saif
Al-Najjar
The year 2025 will go down as a remarkable period for global financial markets. With Donald Trump's comeback in the U.S., investors anticipated changes, yet few expected the dramatic shifts witnessed. Almost every key asset class reacted unexpectedly.
Globally, stock markets enjoyed a successful year, with world stocks climbing around 21%, contributing nearly $15 trillion to total market value. This marked another year of robust gains, despite an initial dip in April due to newly introduced trade tariffs. The swift recovery illustrated investors' appetite for risk amid ongoing political and economic uncertainty.
In contrast, gold emerged as the standout winner in 2025. Historically seen as a safe haven, gold prices soared nearly 70%, achieving their most significant annual rise since the oil shock of 1979. Investors flocked to gold amid escalating trade war concerns, rising global debts, and continuous conflicts. Silver and platinum also experienced significant increases, reflecting the intense demand for safe assets.
Meanwhile, the U.S. dollar weakened, declining around 10% throughout the year, one of its poorest showings recently. This descent enabled many other currencies to thrive, with the euro and Swiss franc rising by approximately 14%. Some emerging market currencies had their best year in over a decade, hinting at a turning point in their long-standing struggle against the dollar.
Bond markets surprised as well. U.S. Treasury bonds saw slight gains, even as long-term yields reached their highest points since 2007 early in the year. Conversely, emerging market bonds excelled, posting their best performance since 2009, undeterred by global concerns about high governmental and corporate debt.
Tech stocks, previously the market leaders, began to lose traction. Following Nvidia’s brief reign as the world's most valuable company, the excitement surrounding large tech firms started to wane. Oil prices dropped nearly 17% in 2025, reflecting diminishing demand and evolving energy patterns. Bitcoin showcased its inherent risks, plummeting sharply after peaking in October, ending the year lower.
Political landscapes significantly influenced market trends. Trump's trade strategies, critiques of the U.S. Federal Reserve, and expansive fiscal measures shaped investor approaches. In Europe, defense and banking shares surged as nations geared up for increased military investment. In emerging markets, political shifts and electoral events triggered volatile changes, particularly in nations like Argentina.
As the market approaches 2026, uncertainty looms large. Investors are closely monitoring global elections, tensions surrounding Ukraine and the Middle East, China's economic revival, and future expenditures in artificial intelligence. Experts caution that, although markets exhibit strength, signs of strain are surfacing, including rising bond yields and declining cryptocurrency valuations.
In summary, 2025 was anything but tranquil for markets, characterized by sharp transformations, unanticipated champions, and distinct markers that suggest the global financial system is transitioning into a new, uncertain era.
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