European markets close mixed on last trading day of 2025; Defense stocks rose

LONDON, ENGLAND - JANUARY 1: Fireworks light up the London skyline over Big Ben and the London Eye just after midnight on January 1, 2023 in London, England. London’s New Years’ Eve firework display returned this year after it was cancelled during the Covid Pandemic. (Photo by Dan Kitwood/Getty Images)

European Markets Close Mixed on Year's Final Day, Capping a Strong 2025 for Major Indices

London — European equities ended a shortened final trading session of 2025 on a mixed note, with the region's major benchmarks closing out a robust year of double-digit gains. The pan-European Stoxx 600 index edged down 0.1% on Wednesday, while Italy's FTSE MIB outperformed with a 0.6% gain, bringing its annual advance to a stellar 31.5%—its best year since 1998.

The U.K.'s FTSE 100 concluded 2025 with a 21.5% yearly gain, its strongest performance since 2009, despite a 0.2% dip on the final day. Germany's DAX also finished in positive territory, rising 0.6%.

Year-End Standouts: Biotech Soars, Defense Stocks Maintain Momentum

Individual stock performances highlighted the year's divergent themes. French biotech firm Abivax closed as the Stoxx 600's top performer for both the day (+3.8%) and the year, boasting an astronomical annual gain of over 1,600%. This surge was fueled by a positive clinical trial readout for its ulcerative colitis treatment and persistent buyout speculation—a classic high-stakes race in the pharmaceutical sector.

Defense stocks such as Saab, Renk, and Rheinmetall rose for a second consecutive day, solidifying their status as some of 2025's biggest winners with annual gains ranging from 130% to 193%. This sustained strength reflects ongoing geopolitical tensions and a continued strategic pivot in government spending priorities.

Commodities and Global Context

Precious metals saw profit-taking, with silver and gold futures retreating 8.4% and 1.4%, respectively. Mining stocks, which had rallied strongly on Tuesday, saw limited follow-through selling on Wednesday.

Globally, markets were quiet. U.S. stocks headed for a fourth-straight losing session in premarket trading, though the S&P 500 was poised to lock in a 17% annual gain. Asia-Pacific markets fell overnight, with several centers closed or closing early for the New Year holiday.

The mixed final session did little to dampen a powerful year for European equities, driven by sector-specific booms in defense and biotech, even as investors navigated a complex competitive ecosystem of economic data and central bank policy. The strong annual closes set a confident stage for markets to reopen in 2026.