Stocks poised for strong end to year; silver, gold stabilise after sharp slump

Asian shares steadied on Tuesday as investors counted bumper gains heading into year-end trade, while silver and gold found their footing after a sharp pullback from record highs took some froth off the precious metals' searing rally.

Hong Kong stocks outperformed regional peers, with the benchmark Hang Seng Index closing up 219 points, or 0.86 percent, at 25,854. Turnover fell 11.02 percent from the previous session to HK$199.7 billion. The city's tech index gained 1.74 percent to end at 5,578.

Mainland Chinese markets were mixed. The Shanghai Composite Index ended virtually flat at 3,965, slipping by less than one point and snapping a nine-day winning streak, while the Shenzhen Component Index rose 0.49 percent.

Japan's Nikkei fell 0.37 percent on the day. For the full year, however, Japanese equities posted a gain of about 26.2 percent, marking a third consecutive year of advances and exceeding last year’s rise of 19.2 percent.

South Korean stocks finished slightly lower on the final trading day of the year, with the KOSPI down 0.15 percent. Despite the soft close, the market recorded an annual gain of more than 75 percent, its strongest performance since 1999, reversing a near 10 percent decline last year.

Gold rose on Tuesday, recovering from a sharp selloff in the previous session, as thin year-end trade exacerbated volatility, with traders expecting fundamental drivers to carry precious metals to new highs in 2026.

Spot gold was up 0.7 percent at US$4,361.71 per ounce, as of 0709 GMT, after hitting a record high of US$4,549.71 on Friday. It fell to its lowest since December 17 on Monday, marking its sharpest daily percentage loss since October 21.

Spot silver was up 3.1 percent at US$74.49 per ounce, after hitting an all-time high of US$83.62 in the previous session. Silver logged its biggest daily loss since August 11, 2020, on Monday.

The metal has gained 158 percent year-to-date, far outpacing gold, propelled by its designation on the critical US minerals list, supply constraints, and low inventories amid rising industrial and investment demand.

"I'm expecting the longer-term rally to continue for both gold and silver, with price targets in the next six months at US$5,010/oz for gold and US$90.90 for silver," said Kelvin Wong, senior market analyst at OANDA.

REUTERS and STAFF REPORTER