U.S. stocks ended 2025 close to record territory but slipped on the final session. According to year-end closes, the S&P 500 finished at 6,845.50 after falling 0.74% on Wednesday. The Nasdaq ended at 23,241.99 after a 0.76% drop, while the Dow closed at 48,063.29, down 0.63%.
Zooming out, the run was still strong. CNBC’s scoreboard shows the S&P 500 up 16.39% in 2025 and the Nasdaq up 20.36%, marking the third straight year of double-digit gains. The setup matters because investors are now entering 2026 with elevated expectations and little room for disappointment.
What powered the year. It was the AI trade. The New York Times argued that A.I. held up Wall Street when other narratives wobbled. Yahoo Finance underscored how performance concentrated in big tech, with Alphabet up 65% and Nvidia up 39% in 2025 amid the “Magnificent Seven” dynamic and heavy capex spending for AI infrastructure (AI trade powers).
Likely next steps: Wall Street’s baseline is still bullish, but returns are expected to compress. CNN highlighted a wide strategist range with the S&P 500 at 6,845.5 into year-end and 2026 targets stretching from 7,100 to 8,000, with volatility along the way still considered normal (2026 targets).
Positioning for 2026 is less about chasing the last percent of a rally and more about stress-testing: can earnings and AI ROI justify today’s multiples if rate cuts slow or growth fragments further.
