Tokyo’s trading floor felt more ceremonial than consequential on Tuesday, but global markets were quietly busy: tech winners that defined 2025 cooled off, precious metals staged a dramatic rebound, and geopolitical noise around Taiwan nudged risk appetite lower.
A thin market with big themes
With most of the world winding down for the year, trading volumes are light — which magnifies price moves. Japan’s Nikkei 225 still managed a symbolic milestone, closing the year-end session above 50,000 for the first time, but indexes across the region were mixed. South Korea’s Kospi slipped and Taiwan’s Taiex fell amid concerns about renewed Chinese military drills around the island. Taiwan President Lai Ching‑te urged calm, saying Taipei would “act responsibly and not escalate conflict,” but investors are watching the situation closely.
Wall Street’s recent tech pullback carried into Asia. Nvidia eased after a volatile stretch, and names tied to artificial intelligence — Palantir, Meta, Oracle among them — gave back some gains as traders debated whether lofty valuations have outpaced realistic near‑term returns. That skepticism is exactly what’s pruning an otherwise frothy corner of the market: when speculation meets thinner year‑end liquidity, swings can be sharp.
Corporate moves echo the AI infrastructure race
SoftBank’s late‑Monday agreement to buy data‑centre investor DigitalBridge for roughly $4 billion landed in that context. The deal is billed as part of SoftBank’s push to beef up AI infrastructure; DigitalBridge shares popped on the news. Masayoshi Son framed the purchase as strengthening the foundation for next‑generation AI data centers — a reminder that bets on chips and models are only one side of the equation. The physical layer of compute, from on‑prem data halls to more speculative concepts, matters.
SoftBank’s push mirrors a much broader race to control the hardware and networks AI needs — everything from conventional colo to moonshot ideas about where compute should live. Industry players are exploring both terrestrial scaling and far‑fetched notions like orbital data centers, a sign that companies are thinking expansively about capacity and latency. For context on those kinds of infrastructure gambits, see how companies are already sketching out ambitious projects such as Google's Project Suncatcher. And the software side keeps evolving too — big tech moves like Apple’s reported plan to lean on a custom Gemini model for Siri show the commercial appetite to stitch AI into everyday products Apple to Use a Custom Google Gemini Model to Power Next‑Gen Siri.
Metals steal the headlines for now
Precious metals staged a conspicuous comeback. Gold regained ground after a steep one‑day drop, and silver surged — rising more than 4% after an 8.7% plunge the day before. Traders attributed the prior slide partly to margin‑related dynamics at major exchanges that forced some positions to be topped up, making silver’s rally as much a technical bounce as a fundamental reappraisal. Both metals have enjoyed a monster run this year: gold is up strongly and silver has more than doubled in 2025, fueled by investor interest as a store of value and by industrial demand stories.
Those moves mattered for broader sentiment. Treasury yields eased — the 10‑year yield dipped back toward the low 4% area — which softened borrowing costs and supported asset prices elsewhere. Oil nudged higher but remained relatively subdued.
Why traders stayed cautious
Several cross‑currents kept asset managers and hedge funds cautious. The Federal Reserve’s December minutes were due later in the U.S. day, and markets were parsing every hint about how the Fed thinks about inflation and the timing of rate changes. Add thin liquidity, geopolitical tension in the Taiwan Strait, and a tech sector whose profits narrative depends on long‑term payoffs, and you have a recipe for choppy trading.
For many institutional players, this is a classic year‑end: positions get trimmed, exposure dialed back, and headline‑driven moves get magnified. That doesn’t mean the longer trends have disappeared — it simply means the market’s short‑term choreography is being rewritten by calendar‑driven flows and event risk.
Markets will likely stay sensitive in the coming days as the world finishes 2025. Expect more volatility than usual for this time of year, especially in assets with concentrated positioning or heavy retail interest — the very areas where momentum can turn on a dime.