America News Agency

In early trading, with the year-end rally’s momentum carrying over, liquidity remained low due to the holiday period and moves across asset classes were limited. In Asia, markets in Japan and China were closed, while others returned from the New Year holiday.

Precious metals continued the strong performance that began last year. Spot gold climbed to $4,360 per ounce, while spot silver rose to $73 per ounce.

Gold’s advance in 2025 marked the largest increase in 46 years, while silver and platinum posted record gains amid a range of factors including Fed rate cuts, geopolitical tensions, strong central bank buying and ETF inflows.

Meanwhile, MSCI’s broadest index of Asia-Pacific shares excluding Japan gained 0.66%, while Hong Kong’s Hang Seng Index rose 1.24%. S&P 500 futures added 0.29% and Nasdaq futures gained 0.36%. European futures were mixed; EUROSTOXX 50 futures fell 0.5% while FTSE futures edged up 0.1%.

After navigating a year marked by tariff wars, the longest U.S. government shutdown on record, geopolitical conflicts and threats to central bank independence, equities delivered strong gains in 2025.

According to analysts, the 2025 rally in U.S. equities was “supported by AI enthusiasm, strong corporate earnings, share buybacks and robust retail flows.” They add that “volatility driven by macroeconomic, geopolitical and political uncertainty, along with periodic shifts in AI sentiment, is likely to remain a feature of equity markets, implying investors should expect more volatility in the year ahead.”

Analysts say much of investor focus this year will center on the strength of the U.S. economy and the Fed’s policy path. A slate of economic data delayed by the U.S. government shutdown is due in the coming days and could be pivotal in gauging how far rate cuts may go.

Investors are pricing only a 15% chance of a Fed rate cut this month, but expect another cut by June. The dollar got off to a weak start to the year; the euro rose 0.1% to $1.1759 and sterling climbed 0.16% to $1.3481.

The yen was slightly stronger against the dollar at 156.64, though still not far from levels that keep investors wary of potential intervention by Japanese authorities to support the weakening currency. With the Fed expected to ease further this year—even as some peers appear ready to raise rates—the dollar remained under pressure after posting its biggest annual drop in eight years in 2025.

The dollar was also weighed down by Trump’s chaotic trade policies and concerns over the Fed’s independence. The issue is set to resurface this year as the U.S. president prepares to announce by month-end who will succeed Jerome Powell.

As a result, while the administration is expected to nominate more dovish voting members to the Federal Open Market Committee (FOMC), the debate over candidates’ qualifications is likely to focus on their market expertise and credentials.

In commodities, oil prices edged higher on Friday after posting their biggest annual loss since 2020 last year. Brent crude futures rose 0.27% to $61.1 a barrel, while U.S. crude climbed 0.25% to $57.7 a barrel.