Australian Shares Start Week Strong

The S&P/ASX 200 climbed 1.9% to close at 8,870 on Monday, rebounding from heavy losses the previous week, tracking significant gains on Wall Street last Friday. US stocks gathered momentum after easing concerns over AI-driven disruption lifted technology shares. In Australia, attention has shifted to a busy week of corporate earnings and economic data. CAR Group surged 9.9% after posting higher H1 net profit and reaffirming its FY26 outlook. Materials stocks also supported the index amid firm underlying commodity prices. Mining giants BHP Group, Rio Tinto, and Fortescue gained between 1.9% and 2.6%, while gold miners Newmont Corporation, Evolution Mining, and Northern Star Resources climbed between 3.6% and 6.5%. On the economic front, household spending unexpectedly fell 0.4% month-on-month in December 2025. It marked the first monthly decline since March 2024, reflecting the ongoing impact of cost-of-living pressures and elevated interest rates.

The S&P/ASX 200 dropped 2% to close at 8,708 on Friday, touching a one-month low, as broad-based sector losses followed a global stock market rout driven by concerns over heavy AI-related spending. The index also posted a 1.8% drop for the week, its largest weekly decline since November 2025, after the Reserve Bank of Australia cut rates in February and signalled further easing this year. Local technology stocks tumbled 3.4% to a more than two-year low, weighed down by hefty capital expenditure plans from US tech giants. Sector leaders Wisetech Global and Technology One fell around 5% each. Resource-linked shares also fell, as gold miners slid 3.2%, dragging the broader mining sector down 2.7% amid ongoing weakness in base metals. Heavyweight miners BHP and Fortescue declined 3.1% and 1.2%, respectively. Meanwhile, merger talks between Rio Tinto and Glencore ended after the companies failed to agree on valuation, scrapping a deal that would have created the world’s largest mining firm.

The S&P/ASX 200 slid more than 1.5% to around 8,750 in early Friday trade, touching a four-week low, as broad-based selling in local resource-linked stocks and a tech-driven slump on Wall Street overnight weighed heavily on sentiment. Technology stocks led the decline, plunging over 4% to reach more than a two-year low. Sector leaders Wisetech Global, Xero, and Technology One dropped between 3% and 6%, tracking US tech giants lower amid weak earnings results and concerns over AI trade. Gold miners also dropped 3.7% on weak bullion prices, pulling the broader mining sub-index down 2.9%. Heavyweight miners BHP Group and Rio Tinto fell 3.7% and 0.4%, respectively, amid a persistent retreat in base and precious metal pricing. Rio Tinto has also ended takeover talks with Glencore after the companies failed to agree on a deal that would have delivered sufficient value to shareholders. Over the week, the benchmark index is headed for its biggest weekly decline since mid November last year.