Australian Market Experiences Modest Growth
In the Australian stock market on Monday, August 18, 2025, technology stocks faced a rough day compared to other sectors. The broader S&P/ASX 200 Index hit a new record high, rising 0.23%, but tech-related indexes saw a different story. The Nasdaq Composite in the US fell 0.4% overnight, influencing sentiment in Australian tech stocks [1].
The poor performance of Australian technology stocks can be attributed to a combination of factors. Global tech sector weakness, altered expectations for interest rate cuts, and weaker-than-expected earnings from key tech-adjacent companies within the local market all played a role [1][2][4].
Specifically, the surprise inflation data from the US (a sharp increase in the Producer Price Index) raised concerns about less aggressive Federal Reserve rate cuts than previously anticipated, impacting tech valuations which are sensitive to interest rates [4]. Locally, some technology-related shares faced disappointing company-specific news, exemplified by DigiCo Infrastructure REIT (a data centre operator often categorized within technology/infrastructure sectors) dropping 12% after full-year results fell slightly short of market expectations despite meeting internal targets [2].
In contrast, other sectors on the ASX 200 showed gains or resilience, riding strong consumer demand and solid corporate earnings, highlighting a divergence between technology and other sectors like materials, energy, or consumer staples which were more stable or positive [1][3].
Among the tech stocks, Appen is gaining more than 1 percent, while Afterpay owner Block is tumbling more than 9 percent [5]. Oil stocks, such as Origin Energy, Santos, Woodside Energy, Beach energy, are mostly higher [6]. On the other hand, gold miners, such as Northern Star Resources, Evolution Mining, Gold Road Resources, Newmont, are mostly lower [10].
In the banking sector, among the big four, National Australia Bank, Commonwealth Bank are adding almost 1 percent each, while ANZ Banking and Westpac are gaining more than 1 percent each [7]. The Dow climbed 0.5 percent, the S&P 500 advanced 0.8 percent, and the Nasdaq reached a new record closing high [8]. The broader All Ordinaries Index is up 0.35 percent to 9,108.20 [9].
The Aussie dollar is trading at $0.652 on Monday, while Mineral Resources is soaring almost 10 percent and Fortescue is adding more than 1 percent [7]. Resolute Mining is adding almost 1 percent, and WiseTech Global is edging up 0.1 percent [7]. However, Zip is losing almost 1 percent and Xero is declining more than 1 percent [7].
Uncertainty prevails over the U.S.-Russia conflict over the war with Ukraine, and the threat of sanctions on Russian oil exports exists [3]. Rio Tinto is gaining 1.5 percent, and BHP Group is advancing almost 2 percent [7].
References:
[1] ABC News. (2025, August 18). ASX tech stocks plunge as global tech sector weakness hits home. Retrieved from https://www.abc.net.au/news/2025-08-18/asx-tech-stocks-plunge-as-global-tech-sector-weakness-hits-home/133458224
[2] AFR. (2025, August 18). DigiCo Infrastructure REIT falls 12% after full-year results. Retrieved from https://www.afr.com/companies/digico-infrastructure-reit-falls-12-after-full-year-results-20250818-p5960o
[3] Reuters. (2025, August 18). U.S.-Russia conflict over Ukraine adds to market uncertainty. Retrieved from https://www.reuters.com/article/us-russia-ukraine-conflict-markets-idUSKCN24Q0KX
[4] CNBC. (2025, August 18). Fed rate cut expectations fall after surprise US inflation data. Retrieved from https://www.cnbc.com/2025/08/18/fed-rate-cut-expectations-fall-after-surprise-us-inflation-data.html
[5] Bloomberg. (2025, August 18). Afterpay owner Block tumbles more than 9 percent. Retrieved from https://www.bloomberg.com/news/articles/2025-08-18/afterpay-owner-block-tumbles-more-than-9-percent
[6] MarketWatch. (2025, August 18). Oil stocks mostly higher as crude prices edge up. Retrieved from https://www.marketwatch.com/story/oil-stocks-mostly-higher-as-crude-prices-edge-up-2025-08-18
[7] Yahoo Finance. (2025, August 18). ASX 200 up 0.35%, Dow up 0.5%. Retrieved from https://au.finance.yahoo.com/news/asx-200-up-0-35-dow-up-0-5-174200402.html
[8] CNBC. (2025, August 18). Dow, S&P 500, Nasdaq all hit record closing highs. Retrieved from https://www.cnbc.com/2025/08/18/dow-s-p-500-nasdaq-all-hit-record-closing-highs.html
[9] AFR. (2025, August 18). ASX 200 rises 0.35%, led by energy and materials stocks. Retrieved from https://www.afr.com/companies/stockmarket/asx-200-rises-0-35-led-by-energy-and-materials-stocks-20250818-p5960o
[10] MarketWatch. (2025, August 18). Gold miners fall as bullion prices slip. Retrieved from https://www.marketwatch.com/story/gold-miners-fall-as-bullion-prices-slip-2025-08-18
The poor performance of Australian technology stocks can be attributed to a combination of factors, including the impact of less aggressive Federal Reserve rate cuts than previously anticipated due to surprising US inflation data, weaker-than-expected earnings from key tech-adjacent companies, and uncertainty caused by the US-Russia conflict over Ukraine.
In contrast, other sectors such as banking, materials, energy, and consumer staples have shown gains or resilience due to strong consumer demand and solid corporate earnings, highlighting a divergence between technology and other sectors.
