Wall Street falls in light trading on the final day of 2025, another banner year for markets

Market Performance - The S&P 500 closed 16.4% higher for the year, marking its third consecutive double-digit annual gain, while the Nasdaq gained 20.4% and the Dow finished 13% higher [2] - Despite a recent downbeat finish, major U.S. stock indexes ended the year with strong gains, with the S&P 500 experiencing a 0.7% decline on the last trading day of the year [1][2] Influencing Factors - Wall Street's gains in 2025 were driven by optimism surrounding artificial intelligence (AI) and its potential to boost profits across various sectors [3][6] - The market faced turbulence due to President Trump's fluctuating tariffs on imports and uncertainty regarding interest rate trajectories [3][4] Profitability Concerns - There are concerns that AI technology may not generate sufficient profits and productivity to justify the investments, which could impact stocks like Nvidia and Broadcom that contributed significantly to market gains [7] - Overall market stocks are perceived as expensive, having risen faster than their underlying profits [8]