The Australian sharemarket experienced a downturn on Friday, driven by renewed anxieties surrounding artificial intelligence overinvestment and its potential disruption to software companies. The S&P/ASX 200 Index declined by 112.80 points, or 1.3 per cent, settling at 8930.70 by mid-afternoon AEDT, with eight out of eleven sectors posting losses. Despite Friday’s slump, the benchmark remains 2.5 per cent higher for the week.
Tech stocks were particularly hard hit, with the ASX tech sector shedding 23 per cent of its value over the past month amid fears that AI could erode software companies’ margins. WiseTech Global, a software company providing solutions to the logistics industry, fell 11.3 per cent, while Xero, a cloud-based accounting software company, lost 3.6 per cent, and TechnologyOne dropped 6.3 per cent.
Elsewhere, gold managed to claw back some losses, trading just under $US5000 an ounce after a sudden sell-off in the previous session prompted by AI concerns. Major gold miners felt the impact, with Northern Star declining 3.8 per cent, Newmont falling 1.8 per cent, and Genesis Minerals dropping 4.8 per cent. Investors also engaged in profit-taking in the banking sector following recent strong gains. Commonwealth Bank decreased by 1.9 per cent, National Australia Bank by 1.1 per cent, and Westpac by 1.5 per cent, despite a stronger-than-expected profit of $1.9 billion.
Among individual stocks, shipbuilder Austal crashed 22 per cent after cutting its FY26 earnings guidance by 18 per cent to $110 million due to a financial error. Cochlear dived 17.9 per cent following a 21 per cent drop in net profit to $162 million, which missed expectations. Webjet tumbled 23.2 per cent as takeover talks with Helloworld and BGH Capital ended without a binding proposal. Conversely, GQG Partners jumped 7 per cent after reporting higher revenue driven by rising management fees, while Nick Scali dropped 18.2 per cent as sales in Australia and New Zealand came in less than expected.
