World stock markets are heading toward record highs as a wave of optimism grips investors ahead of key U.S. economic data. At the same time, the Japanese yen rallied following the strongest warning yet from Tokyo regarding potential currency intervention, while gold and silver continued to climb to record levels on safe-haven demand.

Global Stock Markets on a Holiday High

European shares edged higher in early trade, while U.S. stock futures were largely unchanged. Investors are anticipating the release of U.S. third-quarter GDP data, which is forecasted to show the economy grew at a solid 3.3%, slightly down from the previous quarter due to a retreat in imports after pre-tariff surges.

James Rossiter, Head of Global Macro Strategy at TD Securities, noted:

“It feels like we can relax a bit, and the holiday risk premium has gone down. We are looking for upside risks with GDP growth potentially hitting 3.5%.”

The MSCI World Stock Index rose 0.2%, nearing record highs, while the MSCI Asia-Pacific index (excluding Japan) gained 0.4%, and Tokyo’s Nikkei 225 ended flat.

Corporate Highlights Drive Market Optimism

Several corporate developments contributed to the upbeat sentiment:

• Nvidia (NVDA.O) announced plans to begin shipping its second-most powerful AI chips to China before Lunar New Year, boosting investor confidence.
• Danish pharmaceutical company Novo Nordisk saw shares jump nearly 10% after FDA approval of its new weight-loss pill, strengthening its market position against rivals like Eli Lilly (LLY.N).

Jose Torres, Senior Economist at Interactive Brokers, said:

“Risk-on sentiment is dominating Wall Street as investors increase equity and commodity exposure approaching year-end. There’s optimism for a Santa Claus rally.”

China’s CSI300 blue-chip index also rose 0.2%, supported by government plans to stabilize the property market and launch the latest Five-Year Plan (2026-2030).

Yen Rally and Intervention Risk

The Japanese yen strengthened to 155.88 against the U.S. dollar, following statements from Finance Minister Satsuki Katayama highlighting Tokyo’s readiness to intervene in the currency market if needed. The yen also gained against the euro and Swiss franc.

While the Bank of Japan (BOJ) raised rates in December, Governor Kazuo Ueda offered few clues about the pace of future hikes. Alicia Garcia-Herrero, Chief Economist for Asia Pacific at Natixis, commented:

“Their message was underwhelming… you hike, but you need to hike with conviction. They didn’t hike with conviction.”

Precious Metals Hit Record Highs

Gold approached $4,500 per ounce, while silver also reached all-time highs, fueled by safe-haven demand amid escalating geopolitical tensions, including U.S. actions against Venezuelan oil tankers.

Oil Prices Remain Stable

Crude oil prices remained broadly steady, with Brent crude trading around $62 per barrel and U.S. crude near $58 per barrel, as year-end market optimism balanced out geopolitical and supply concerns.

Conclusion: Holiday Optimism Supports Markets Amid Currency and Safe-Haven Volatility

As global markets close in on record highs, investor sentiment is buoyed by strong corporate earnings, positive economic forecasts, and year-end optimism. However, the yen’s intervention risk and continued geopolitical tensions maintain volatility in currency and precious metals markets, keeping investors alert as 2025 draws to a close.