Stocks Finish 2025 Higher Amid Explosive Year for AI

• Major AI deals included Softbank's advanced talks to acquire DigitalBridge for $4 billion and Meta's acquisition of Singapore-based AI startup Manus
• Multiple companies announced AI-focused spinoffs, including Applied Digital spinning off its cloud business and Chinese AI giant (unnamed) planning to list its semiconductor unit in Hong Kong
• Tech stocks dominated performance throughout 2025, with AI infrastructure and alternative energy plays like uranium producer Cameco benefiting from increased demand

Market Summary: Stocks Close 2025 Higher on AI Momentum

U.S. equity markets concluded 2025 with gains across all major indices, marking their third consecutive positive year. The Dow Jones Industrial Average rose 13%, the S&P 500 gained 16.4%, and the Nasdaq Composite led with a 20.4% increase, driven primarily by AI-related growth in technology stocks.

Despite a year-end correction and four straight daily losses entering 2026, all three benchmarks also posted gains for the third consecutive quarter. Tech stocks dominated performance throughout 2025, though momentum softened in the final weeks.

Key Corporate Developments:

• SoftBank is in advanced negotiations to acquire DigitalBridge (DBRG) for $4 billion to expand AI infrastructure capabilities
• Meta (META) announced the acquisition of Manus, a Singapore-based AI startup
• Applied Digital (APLD) plans to spin off its cloud business, merging with Ekso Bionics (EKSO) to form "ChronoScale"
• Chinese AI giant (unnamed) announced plans to spin off its semiconductor unit, Kunlunxin, targeting a Hong Kong listing

Market Outlook:

The Federal Open Market Committee's decisions were in focus during the week, while precious metals experienced significant volatility with some hitting record highs. Alternative energy plays like uranium producer Cameco (CCJ) have benefited from increased demand tied to AI's power requirements.

Looking ahead to 2026, market participants are evaluating whether the high expectations for AI-related growth can be sustained after technology stocks dominated the year's top performers. The market remains mixed as investors assess the sustainability of the AI-driven rally amid broader economic considerations.