By Benadeta Mwaura - Reporter
Kenya, December 29 2025 - As global markets wrap up 2025, investors are navigating a landscape defined by divergent asset trends. Stock markets advanced on optimism around future rate cuts, while Bitcoin lagged broader performance, and precious metals such as gold and silver surged to record highs amid macroeconomic uncertainty.
Economists say the profile of winners this year reflects a rotation toward defensive and real- asset plays, even as equities showed pockets of strength globally. Global equities ended the year on a high note, propelled by bets that the U.S. Federal Reserve will begin cutting interest rates in 2026.
Asian stocks climbed to six-week highs, with indexes like South Korea’s Kospi and Japan’s Nikkei posting annual gains of roughly 75 per cent and 27 per cent respectively. European markets also opened higher following year-end trading, while the MSCI Asia-Pacific index advanced on strong sentiment.
“Investors have been lifted by expectations of rate cuts and a weaker dollar, which tends to support risk assets and commodities,” said Charu Chanana, chief investment strategist at Saxo. “Precious metals, in particular, have responded strongly to these macro drivers.” On the U.S. side, major indices like the S&P 500 and Nasdaq showed resilience throughout the year, with renewed appetite for stocks after bouts of volatility tied to inflation data and economic growth reports.
A financial wrap noted that positive earnings and robust private payrolls earlier in the year contributed to sustained stock market momentum. On African exchanges, performance was mixed but generally positive. South Africa’s All Share Index and key Nigerian equities posted attractive annual gains, while the Nairobi Securities Exchange (NSE) recorded notable movements among blue-chip counters.
Retail investor interest in local stocks, especially in sectors tied to consumer staples and banking, contributed to trade volumes, although foreign investor participation remained subdued, according to market analysts tracking flows on the NSE. The cryptocurrency market told a different story than equities and metals.
Bitcoin’s price performance in 2025 lagged behind major asset classes, showing tepid gains or periods of drawdown compared with gold and silver. According to wider market trackers, Bitcoin’s annual return trailed the remarkable precious metals rally despite periodic spikes above lower-hundred-thousand dollar levels.
“Bitcoin continues to show relative weakness compared with major indices and precious metals,” said a crypto analyst quoted by CoinMarketCap, noting Bitcoin’s gain was modest compared with markets like gold.
Recent analysis highlights a divergence between Bitcoin and traditional safe havens, with precious metals absorbing much of the inflows usually attributed to defensive capital. One market observer noted that silver’s surge, driven by both safe-haven demand and strong industrial use, has underscored metals’ value proposition compared with digital assets.
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Precious metals outperformed nearly every asset class in 2025. Gold posted gains not seen in decades, with prices breaching historic marks as investors sought refuge amid macro uncertainty and geopolitical tension.
Meanwhile, silver’s performance was even more dramatic, with spot prices climbing above $80 per ounce in volatile trading as the year drew to a close, a fresh high and a standout result.
“Gold has repeatedly breached record highs this year, underscoring its continued role as a defensive asset,” noted analysts tracking the year’s gains. Silver, benefiting from both safe-haven demand and industrial consumption, delivered an extraordinary annual return, far outpacing most other asset classes.
The metals rally, buoyed by expectations of easing monetary policy and a softer U.S. dollar, has influenced how investors allocate across portfolios, with some chartists even observing shifts in traditional valuation ratios, such as the Bitcoin-to-gold ratio, reflecting reduced appetite for digital stores of value relative to physical assets.
Markets this year showcased a rotation out of extreme risk assets during times of uncertainty, favoring stocks with defensive characteristics, then moving capital into metals as macro risk hovered over forecasts.
Expectation of rate cuts in 2026 has been a major driver, lifting equities and commodities alike by reducing yields and increasing liquidity in financial markets. Geopolitical tensions and uneven global growth prospects amplified demand for traditional hedges like gold and silver, rather than speculative assets.
Financial strategists say diversified portfolios that blend equities with hedge assets such as metals, and measured exposure to growth assets like Bitcoin, may be better positioned to navigate near-term volatility.
“As markets anticipate more accommodative policy, the interplay between risk and safe-haven assets will remain central,” said one global market strategist familiar with end-of-year positioning.
