A late PS: The three major U.S. stock indices closed in negative territory tonight.

The S&P 500 lost 25 points, or 0.4%, to end at 5,881 points, while the Nasdaq Composite fell by 0.90%.

For 2024, the Nasdaq surged nearly 30%, while the bellwether S&P 500 notched more than a 23% gain, marking the index’s best two-year run since 1997-1998.

The Dow Jones Industrial Average dipped slightly, to finish at 42,544.22 points, meaning it gained almost 13% during the year.

Time to wrap up, for the last time this year.

The UK’s blue-chip stock index has recorded its strongest annual gain since 2021, despite lagging behind Wall Street over the past year.

The FTSE 100 index, which tracks the largest companies listed in London, posted a rise of 5.7% for 2024.

Having begun the year at 7,733 points, the FTSE closed 440 points higher at 8,173 points today.

That was its fourth year of gains in a row, after rising 14.3% in 2021, 0.9% in 2022 and 3.8% in 2023, which came in the wake of a 14.3% plunge in 2020, when the Covid-19 pandemic rocked markets.

But London stocks have lagged behind New York, where the S&P 500 index gained over 23% this year.

Russian gas supplies to Europe via Ukraine are set to end on New Year’s Day, ending Moscow’s long dominance of supply in the European gas market.

Russia’s oldest gas export route to Europe - a pipeline dating back to Soviet days - was set to shut at the end of 2024, as a five-year transit deal between Russia and Ukraine expires. Data from Ukraine’s gas transit operator showed on Tuesday that Russia had not requested any gas flows for January 1st.

China’s economy is on course to expand by 5% in 2025, according to its president, Xi Jinping, meeting official growth targets and rebutting concerns that Donald Trump’s incoming US administration will harm Beijing’s prospects in the new year.

A US government fund to compensate people swindled by Bernie Madoff is making its final round of payments, taking the total paid from the fund to the late fraudster’s victims to $4.3bn (£3.4bn).

The boss of Britain’s biggest building society has warned that working from home could harm women’s careers because they are less likely to come into the office than their male colleagues.

Passengers on the London to Glasgow main line face disruption to services in the coming days because of strikes by train managers at Avanti West Coast.

The opening bell has rung on Wall Street for the final time in another blockbuster year for stocks.

The main indices in New York have risen in early trading, with the Dow Jones industrial average up 79 points or 0.2% at 42,653 points.

The broader S&P 500 index is up 0.1%, while the tech-focused Nasdaq Composite nudged up by just 0.018%.

For the year, the Dow has gained 13% and the S&P 500 24%, while the Nasdaq is up around 30% thanks to hot tech stocks such as Nvidia (up 177% this year).

Britain’s FTSE 100 share index has closed for the year, posting a 5.7% gain for 2024.

The index of blue-ship shares listed in London has gained 440 points this year.

As the market closed early for New Year, the FTSE 100 ended the day up 52 points or 0.65% today at 8173 points, having begun 2024 at 7733 points.

This is the fourth year in a row that the FTSE 100 has risen, after it plunged in 2020 in the first year of the Covid-19 pandemic.

But it’s a smaller gain than Germany’s DAX and Japan’s Nikkei, which both gained around 19% this year, while in New York the S&P 500 has risen by over 23%.

Earlier this year the FTSE 100 hit a record high of 8474 points, in May, before slipping in the second half of the year.

Matt Britzman, senior equity analyst at Hargreaves Lansdown, says.

“The FTSE 100 wrapped up 2024 on a high note, shaking off a slow start to the session to finish the year in positive territory. After an impressive climb early on, the index hit an all-time high in May but couldn’t quite muster the momentum to break out of a rangebound pattern in the months that followed.

Meanwhile, it played second fiddle to the tech-fuelled US markets, where AI excitement sent the S&P 500 soaring. Back home, UK investors navigated a year of twists and turns, with two interest rate cuts offering relief while a tax-hiking budget put pressure on some domestic companies.

It was a year of resilience rather than runaway success for the UK’s blue-chip benchmark.

British energy bills will rise tomorrow, when the next price cap kicks in, and consumers could face further increases in April.

Regulator Ofgem announced last month that the average annual energy bill in England, Scotland and Wales will increase to £1,738 from January, due to a 1.2% increase in its quarterly price cap.

Consultancy group Cornwall Insight has predicted today that the cap will rise again in April to £1,785 a year for a typical dual fuel consumer, nearly a 3% increase on January’s level.

Cornwall had previously expected a smaller rise next April, of around 1%.

Today Cornwall says:

Early December saw a slight dip in wholesale energy prices, driven by easing supply tensions in Europe. However, geopolitical instability saw prices rebound in the second half of December, with the market surging last week due to new uncertainty over the Ukraine transit deal and the higher level of withdrawals from EU gas storage facilities. This all affected our view of consumer bills in 2025.

These factors, combined with the significant uncertainty over the US LNG export plans under a second Trump presidency, mean we are expecting that our cap forecasts will continue to display a high degree of variability.

China’s stock market has ended the year on a weak note.

The CSI 300 index fell by 1.6% today, despite president Xi predicting China’s growth target would be hit, while stocks in Shenzhen fell by 2.5%.

For the year, though, the CSI 300 index – which measures the 300 largest stocks listed in Shanghai and Shenzhen – has risen by over 14%. Those gains were driven by China’s latest stimulus programme, which stocks surging in late September and early October:

China’s president Xi Jinping has predicted that the country’s economy will grow by around 5% this year.

Xi’s comments, in a speech published by the official Xinhua News Agency, are a signal that the world’s second-largest economy is on track to meet its official target.

Xi also reiterated a call to adopt more proactive macroeconomic policies.

Speaking to a gathering of China’s top political advisory body to usher in the new year, he said:

“On the journey of Chinese modernization, we will not only encounter clear skies and gentle breezes, but also face high winds, choppy waters, and even dangerous storms.

We must maintain strategic resolve and pool the great strength of all Chinese people striving in unity to cut through the waves and forge ahead with courage.”

More here: Xi calls for forging ahead to build strong China

2025 could bring more gains on the UK stock market, brokerage AJ Bell has predicted.

It has predicted the FTSE 100 could hit 9,000 points by the end of 2025, which would be require a roughly 10% jump next year.

Their investment director Russ Mould argues that the “prevailing gloom” means UK equities look cheap on an earnings and yield basis, adding:

“Political uncertainty should now be receding in the UK, given the Labour government’s thumping majority, and this offers a favourable comparison with Europe, where coalition administrations now seem to be falling over at a pace to match that of the Conservative Party’s enthusiastic sacking of its leaders, prime ministers and chancellors in recent years.

The jury may still be out on the new chancellor’s first Budget, but some credit should be given for at least acknowledging the fiscal deficit which faces the country, a topic barely mentioned during the US election campaign and one that is now coming home to roost in France.

2024 has also been a strong year for the US dollar, whcih is on track to record strong gains against most currencies.

The dollar index, which measures the greenback against a basket of rival currencies, is up 6.5% over the last year.

It has been lifted by expectations that the US Federal Reserve will be slower to cut interest rates than rival central banks in 2025, if the incoming Trump administration’s policies – such as new tariffs on imports – are inflationary.

Trump’s election victory is expected to lead to US fiscal expansion characterised by increased spending and tax cuts.

Tony Sycamore, market analyst at IG, explains:

This, in turn, is likely to result in stronger US growth, higher inflation, and, subsequently, higher interest rates, all of which contribute to a stronger US dollar.

Furthermore, Trump’s election victory is anticipated to result in tariffs on imports from countries, including China. Mexico, Canada and the EU which will dampen growth expectations outside the US and weigh on commodity prices.

Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.

It’s the final trading day of the year, when investors will be adding up their profits (or losses) and turning their attention to 2025.

2024 has been another year of gains in the stock markets, with record highs seen on both sides of the Atlantic. Wall Street has led the charge, helped by the boom in tech stocks which continued over the last 12 months.

Investors in the UK stock market have enjoyed gains too – the blue-chip FTSE 100 index is on track to record a 5% rise this year, broadly in line with the European average. That would be its best year since 2021, when it rose 14.3%, and follows a 0.9% rise in 2022 and a 3.8% gain in 2023.

The ‘Footsie’ is ending the year on the back foot, though, down 2% in December. Yesterday it closed at 8121 points, a fair way shy of the record high of 8,474 set in May when falling inflation and hopes of interest rate cuts were lifting stocks.

The smaller FTSE 250 index, seen as a better barometer of the UK economy, has gained around 3.6%.

That doesn’t include the income from dividends, though, which shareholders received over the year.

As AJ Bell investment director Russ Mould puts it:

“Total returns from the UK stock market in 2024 handily beat cash, bonds and inflation, but the poor comparisons with the USA remain the stick with which the FTSE 100 is constantly beaten.

Whether the NASDAQ and S&P 500 will finally run out of puff in 2025 remains a matter of debate, but value- and income-seeking contrarians could be forgiven for giving the UK a closer look, given consensus forecasts for earnings and dividend growth.

Across the channel, France’s CAC 40 has lost around 3% during a year punctuated by political drama in Paris.

But Germany’s DAX, which closed for the year yesterday, has gained almost 19% – driven by software company SAP which rose 60% in the year.

Tech stocks also drove Wall Street higher, lifting the Nasdaq by almost 30% so far this year, and the S&P 500 index by over 23%.

Tom Stevenson, investment director for personal investing at Fidelity International, explains:

“After the turbulence of 2023, we’ve seen a marked shift towards growth, driven by stabilising inflation and a more positive outlook for interest rates.”

But in December alone, equity markets have been on the back foot – seemingly worried by ructions in the bond market where yields (interest rates) have been rising amid fears of sticky inflation in 2025.

This year has not brought much of a Santa Rally, and we may not get one today either – with the futures market indicating shares may dip in London.

London’s market will close early at lunchtime, giving traders time to spruce up for New Year festivities.

The agenda

• 12.30pm GMT: London stock market closes early for New Year

• 2pm GMT: CaseShiller index of house prices for October