Australian Shares Open Lower Following Massive Wall Street Selloff

UPDATE - follow-up to Wall Street suffers $4.6tr wipeout as AI stocks plunge, ASX set to slide lower: The Australian sharemarket dropped sharply at the open after a massive sell-off swept through Wall Street, driven heavily by companies tied to building artificial intelligence data centres.

Market Impact

The S&P/ASX 200 fell 128.1 points, or 1.4 per cent, reaching 8937 in early trade, while the Australian dollar weakened to US69.52 cents. Overnight in the United States, the S&P 500 tumbled 4.4 per cent, marking its worst drop since President Donald Trump introduced tariffs in April 2025. The Dow Jones Industrial Average dropped more than 1800 points, and the Nasdaq composite fell 5.5 per cent, wiping out about US$3.2 trillion from Wall Street.

Tech And AI Pressures

Global technology shares faced heavy pressure due to rising concerns over potential pauses on data centres following Democratic wins in the US midterm elections. Nvidia fell 9.3 per cent, Advanced Micro Devices tumbled 17.3 per cent, and cloud chip rental firm CoreWeave dropped 9.8 per cent. Power infrastructure provider GE Vernova sank 7.5 per cent. In Asia, South Korea's Kospi index dropped 5.3 per cent and Japan's Nikkei 225 fell 1.8 per cent.

Bright Spots

Amid the broad losses, AppLovin jumped 31 per cent after reporting strong profits and a stock buyback program valued up to US$3.2 billion. Tapestry also rallied 7.1 per cent after beating profit expectations and raising its fiscal year forecasts.

Context

Stock markets globally remain sensitive to shifts in interest rates, corporate earnings, and major geopolitical tensions like the war with Iran. When major technology sectors experience sudden corrections, international markets frequently mirror these losses due to interconnected global trading.