Australian shares slip below 9,000 level as AI regulation fears hit miners, tech

On Friday, Australian shares dipped below the 9,000 level, falling 0.8% to 8,994.50 points, marking the biggest single-day decline since October 1. Miners and technology stocks bore the brunt of the sell-off, as concerns over stricter AI and data centre regulation following the Democrats' victory in the US Congress triggered a wave of pessimism on Wall Street.

The S&P/ASX 200 index had surged 2.6% on Thursday, breaching the psychologically significant 9,000 mark. Global sentiment took a hit as the Nasdaq experienced its steepest daily decline since April 2025, as investors reevaluated AI-related valuations and contemplated the regulatory landscape under a Democrat-controlled Congress.

Oil prices climbed higher due to renewed attacks on tankers, dampening risk appetite further. Miners in Sydney faced their weakest session since March 19, shedding 4.4% as copper retreated from an earlier AI-fueled rally. BHP, a major miner with a growing share of profits from copper, plummeted 4.9%. Rio Tinto and Fortescue also saw declines of 3.9% and 2.9%, respectively.

Gold stocks slipped 2.9% despite higher bullion prices. Technology stocks fell 2.6%, while real estate endured a 1.3% dip. Financials managed a modest gain of 0.9%, with investors rotating into defensive sectors. The "big four" banks increased between 0.8% and 2.2%. However, Macquarie Group, a leading investment bank, plummeted as much as 5.7% despite posting its highest-ever first-half profit.

The Australian prudential regulator revealed that Macquarie had miscalculated the capital needed to cover risks in its non-banking businesses in 2019. Consumer staples rose 1.6% in the market, while New Zealand's S&P/NZX 50 index slipped 0.9% to 13,965.94 points.