Published by Global Banking & Finance Review®
Posted on December 29, 2025
4 min readLast updated: January 20, 2026
U.S. stocks dipped below record highs, while global indexes are on track for significant gains in 2025 amid geopolitical tensions and shifting interest rate expectations.
By Stephen Culp
NEW YORK, Dec 29 (Reuters) - U.S. stocks dipped on Monday and gold tumbled from all-time highs at the top of a holiday-shortened week.
The three major U.S. stock indexes ended in negative territory, weighed down by a broad selloff, which was slightly mitigated by strength in some defensive sectors that have underperformed for much of the year.
Treasury yields eased and the dollar inched above its lowest level in almost three months, reflecting shifting expectations of Federal Reserve interest rate cuts in the coming year.
"In light volume trading, we’re seeing a reversal of what we saw over the last couple of days," says Rob Haworth, senior investment strategist at U.S. Bank Wealth Management in Seattle. "The broader market is looking at the strength of last week and selling off as we head into year-end. "
Market participants were closely monitoring negotiations between U.S. President Donald Trump and Ukrainian President Volodymyr Zelenskiy, with Trump saying they were getting "a lot closer" to a deal that could end Russia's war on Ukraine. But hopes for a deal dimmed after Russia accused Ukraine of trying to attack President Vladimir Putin's residence, in a potential roadblock to further negotiations.
With just three sessions remaining, U.S. and global stocks were on course to end 2025 near record highs, having notched double-digit gains in a tumultuous year dominated by tariff wars, central bank policy and simmering geopolitical tensions.
"When we started the year, we saw tariffs get implemented and the question was ‘will the market survive?’ The answer was yes," Haworth added. "The global economy has managed to weather many of the storms and uncertainties this year because consumers were spending and business continued to invest."
"The more we can broaden out, that gives this rally more room to run," Haworth said. "We’ve had three years of strong gains there’s reason for us to expect a fourth."
The Dow Jones Industrial Average fell 249.04 points, or 0.51%, to 48,461.93, the S&P 500 fell 24.19 points, or 0.35%, to 6,905.75 and the Nasdaq Composite fell 118.75 points, or 0.50%, to 23,474.35.
European stocks hit new all-time highs as gains in technology and consumer-focused stocks, although gains were capped by weakness in defense shares.
MSCI's gauge of stocks across the globe fell 2.18 points, or 0.21%, to 1,020.63.
The pan-European STOXX 600 index rose 0.09%, while Europe's broad FTSEurofirst 300 index rose 1.93 points, or 0.08%.
Emerging market stocks rose 4.41 points, or 0.32%, to 1,401.81. MSCI's broadest index of Asia-Pacific shares outside Japan closed higher by 0.32%, to 721.89, while Japan's Nikkei fell 223.47 points, or 0.44%, to 50,526.92.
The dollar steadied and the yen strengthened following the release of the minutes from the Bank of Japan's policy meeting, but currency traders remained alert to the possibility of a BOJ intervention.
The dollar index, which measures the greenback against a basket of currencies including the yen and the euro, rose 0% to 98.03, with the euro down 0.01% at $1.177.
Against the Japanese yen, the dollar weakened 0.31% to 156.06.
In cryptocurrencies, bitcoin fell 0.42% to $87,177.85. Ethereum declined 0.21% to $2,928.82.
U.S. Treasury yields edged lower as investors adjusted their bets for interest rate cuts from the U.S. Federal Reserve in the coming year as economic data releases slowly return to their post-shutdown normal.
The yield on benchmark U.S. 10-year notes fell 2.8 basis points to 4.106%, from 4.134% late on Friday.
The 30-year bond yield fell 2.5 basis points to 4.7938% from 4.819% late on Friday.
The 2-year note yield, which typically moves in step with interest rate expectations for the Federal Reserve, fell 2.6 basis points to 3.457%, from 3.483% late on Friday.
Oil prices jumped as talks between U.S. and Ukrainian presidents on a possible deal to end the Russia-Ukraine war was complicated by Russia's accusations, and against potential oil supply disruptions in the Middle East arising from growing tensions in Yemen.
U.S. crude rose 2.36% to settle at $58.14 per barrel, while Brent settled at $61.94 per barrel, up 214% on the day.
Gold tumbled from record highs along with other precious metals amid profit taking. Spot gold fell 4.47% to $4,329.65 an ounce. U.S. gold futures fell 3.31% to $4,379.00 an ounce.
(Reporting by Stephen Culp; Additional reporting by Naomi Rovnick in London and Ankur Banerjee in Singapore; Editing by Alistair Bell and Nick Zieminski)
The stock market is a collection of markets where shares of publicly traded companies are bought and sold. It serves as a platform for investors to trade ownership in businesses.
Cryptocurrencies are digital or virtual currencies that use cryptography for security. They operate on decentralized networks based on blockchain technology.
Economic growth is the increase in the production of goods and services in an economy over a period of time, typically measured by the rise in gross domestic product (GDP).
The Federal Reserve, often referred to as the Fed, is the central bank of the United States responsible for regulating monetary policy and maintaining financial stability.
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