MSCI’s broadest index of Asia-Pacific shares outside Japan was 0.17% lower on Wednesday

Asian stocks drifted on the last trading day of a year that has seen investors brush off much of the tariff-related uncertainty and embrace AI chip stocks, while the dollar’s dismal year has left the euro and sterling standing tall.

Precious metals have grabbed much of the spotlight toward the end of the year, with silver’s astonishing rally taking its yearly gains to more than 160% although the metal was 1% lower on Wednesday as traders booked profits.

Gold firmed a bit and is on track for a 66% surge in 2025 as the three-year rally continues.

Japanese markets are closed for the rest of the week, and with some markets closed on Thursday for the New Year’s Day holiday, volumes are likely to be thin and moves muted.

MSCI’s broadest index of Asia-Pacific shares outside Japan was 0.17% lower on Wednesday. The index is poised to clock a 27% rise for the year, its sharpest rise since 2017, mainly on a strong rally in chipmakers amid the boom in artificial intelligence-related stocks.

China’s blue-chip index inched higher, on course for an 18% increase for the year while Hang Seng slid 0.7% but was looking to clock a 28% gain for 2025 as investors shrugged off trade war worries.

Kospi is the best performing major stock market, increasing 76% in the year, with a lot of those gains coming from SK Hynix and Samsung.

Notwithstanding a few little shocks, the year has been terrific for investment returns, said Kyle Rodda, senior financial analyst at Capital.com.

The gains have been a little concentrated obviously but the combination of the AI boom and accommodative monetary and fiscal settings have driven risk assets higher and around record levels, Rodda added.

Heading into 2026, AI is still the anchor theme, but in a different phase: less hype, more adoption and return on investment scrutiny, said Charu Chanana, chief investment strategist at Saxo in Singapore.

The biggest risks are an unwinding of crowded positioning in both AI and precious metals, Chanana said. Add to that a market that’s too confident about a smooth rate path, and the real economic impacts of tariffs that weren’t fully evident in 2025 starting to show up in 2026, repricing inflation expectations and profit margins quickly.