The Australian sharemarket closed sharply lower on Friday as renewed concerns about artificial intelligence overinvestment and potential disruption to software companies weighed on sentiment.
The S&P/ASX 200 fell 125.9 points, or 1.4%, to 8,917.6, with nine of the 11 sectors finishing in negative territory.
Despite the retreat, the benchmark index held onto a 2.4% gain for the week.
The Information Technology sector led the declines, as fears that AI-driven competition could erode profit margins across the software sector intensified.
The sector has now shed 24.5% of its value since the start of 2026.
Among the major names, WiseTech Global tanked 10.4%, TechnologyOne lost 7.1%, and Xero fell 4.5%.
Healthcare stocks also came under significant pressure. Cochlear plunged 17.9% after reporting a 21% fall in net profit to $162 million, missing market expectations. The company warned that full-year profit would likely come in at the lower end of its $435 million to $460 million guidance range.
CSL slipped 1.4%, while Fisher & Paykel Healthcare dropped 6.3%, ResMed fell 4.6%, and Pro Medicus lost 8.4%, compounding the sector’s weakness.
Financial stocks also softened as investors locked in profits following recent strength. Commonwealth Bank and National Australia Bank declined 1.4% and 1.1%, respectively, while Westpac fell 1.5% despite posting a stronger-than-expected $1.9 billion profit. Westpac’s net interest margin narrowed, tempering enthusiasm around its earnings result.
In contrast, ANZ added 1.3% following analyst upgrades after its better-than-expected quarterly update yesterday.
AMP surged 9%, rebounding from its steepest fall in more than two decades in the prior session.
Elsewhere, Austal slumped 22.8% after cutting its FY26 earnings guidance by 18% to $110 million, citing a financial misstep.
Webjet tumbled 25.2% after confirming it had ended takeover discussions with Helloworld and BGH Capital due to the absence of a binding proposal.
The company also trimmed its underlying FY26 EBITDA guidance to between $28 million and $29 million, excluding Webjet Business Travel.
Furniture retailer Nick Scali dropped 22.3% as weaker-than-expected sales in Australia and New Zealand offset a stronger performance from its UK operations.
In fixed income markets, Australian government bond yields edged higher, with the 10-year yield rising 0.4% to 4.751% and the 2-year yield climbing 0.2% to 4.229%.
