Investors cannot complain to the Wall Street behavior in 2025. At the close of Tuesday, the DOW JONES has risen 13.7% in 2025, while the S&P 500 has advanced 17.3% and the Nasdaq 21.3%. The month of December will also be positive, with the Dow gaining 1.4%, on track for its eighth consecutive month of gainsthe first such streak since 2018. The S&P 500 rises 0.7%, also on track for an eight-month streak of gains. The Nasdaq advances a more modest 0.2%.
However, in the last three days the major indices have closed negative, and everything seems to indicate that the same tone will continue on the last day of the year. These falls complicate the traditional Christmas rallywhich usually occurs between the last five trading days of the year and the first two of the next.
The recent profit taking could also anticipate some of the looming volatility. Or at least that is what the analysts surveyed by the CNBC. Although strategists predict the S&P 500 could post another double-digit advance in 2026, many worry that stocks could spend much of the year in a range as corporate earnings growth reaches lofty multiples.
“Looking ahead to next year, we expect a little more volatility,” Meghan Shue, director of investment strategy and portfolio construction at Wilmington Trust, tells CNBC. “I think this is a good trend as we prepare for the next leg of the bull market, which we expect to continue, beyond the still fairly high recession risk we still have.”
Artificial intelligence has been the driving force of the market for the last three years. In 2023, the S&P 500 is up 24%, after ChatGPT’s debut the previous year sparked great fervor around the companies most likely to benefit from a technological revolution. In 2024, the index is up 23%. At Tuesday’s close, in 2025, the S&P 500 was up more than 17% and was only slightly below its all-time highs.
Still, the AI narrative appears to be weakening a bit this year, as the rally began to spread to other sectors, and even the stock performance of the so-called Magnificent Seven became bifurcated. Alphabet is the big winner among megacaps, up more than 65% so far this year as investors bet the search giant could overtake OpenAI. Amazon has fallen behind, with an approximate profit of just 6%.
In commodity markets, oil prices fall more than 15% in 2025, after supply exceeded demand in a year marked by wars, higher tariffs and OPEC+ production, as well as sanctions on Russia, Iran and Venezuela. On the other hand, 2025 has been the year of precious metals, with Gold rising 66% until yesterday and Silver 166.5%. Cryptocurrencies have had worse luck, with Bitcoin on track to close the year negative (-5.8%).