Morning Wrap: ASX 200 to rise, S&P 500 dips on AI disruption fears, Tech stocks extend selloff

ASX 200 futures are up 21 pts (+0.23%) as of 8:30 am AEDT.

In a nutshell:

• Major US benchmarks lower and finished near worst levels

• Risk-off theme driven by a Citrini report and Claude updates (now disruption cybersecurity and consulting stocks)

• Gold up another 2.4% overnight, now up over 7% in the last four sessions and back above US$5,200/oz

• Defensives like Staples, Healthcare and Utilities finished the session higher, despite elevated multiples (e.g. Walmart rallied 2.2% but trades at 45x)

Let's dive in.

Overnight Summary

Tue 24 Feb 26, 8:27am (AEST)

Name	Value	% Chg
Major Indices
S&P 500	6,838	-1.04%
Dow Jones	48,804	-1.66%
NASDAQ Comp	22,627	-1.13%
Russell 2000	2,620	-1.66%
Country Indices
Canada	33,777	-0.12%
China	4,082	-1.26%
Germany	24,992	-1.06%
Hong Kong	27,082	+2.53%
India	83,295	+0.58%
Japan	56,826	-1.12%
United Kingdom	10,685	-0.02%

Name	Value	% Chg
Commodities (USD)
Gold	5,230.35	+2.37%
Copper	5.7978	-0.71%
WTI Oil	66.44	-0.06%
Currency
AUD/USD	0.7059	-0.35%
Cryptocurrency
Bitcoin (USD)	64,626	-4.16%
Ethereum (AUD)	2,643	-3.87%
Miscellaneous
US 10 Yr T-bond	4.029	-1.39%
VIX	21.51	+12.70%

S&P 500 SESSION CHART

S&P 500 lower, finished near worst levels (Source: TradingView)

OVERNIGHT MARKETS

• Major US benchmarks lower and finished near worst levels

• Citrini report doing the rounds (more on this below) – leading to a sharp selloff across Financials and Tech stocks, with names like JPMorgan, Visa, Mastercard, Morgan Stanley, American Express all down 4-7%

• Big Tech broadly lower, with Microsoft (-3.2%), Tesla (-2.9%), Meta (-2.8%) and Amazon (-2.3%) all notable decliners

• Another risk-off themed session, where defensives like Staples, Healthcare and Utilities finished sharply higher

• Walmart (+2.2%) was a notable gainer in the defensive space, interesting to see it rally despite trading at a trailing 45x

• Software stocks continue to sell off with Citrini report on AI disruption risks the latest catalyst (BBG)

• Hedge funds sold global stocks at fastest pace since April 2025 last week (BBG)

• Moody's warns gap in US accounting rules allow Big Tech to conceal tens of billions of AI data centre liabilities (FT)

• Bond market sentiment shifts bearish after SCOTUS ruling (BBG)

• China AI stocks continue to defy 'AI scare trade' (BBG)

STOCKS

• OpenAI reportedly lifted five year revenue forecasts by 27%, also expects to burn additional $112bn in cash, or double previous ests (TI)

• OpenAI is entering into multiyear partnerships with Accenture, Boston Consulting Group, Capgemini, and McKinsey (CNBC)

• IBM latest to face Anthropic disruption after announcement Claude has COBOL coding capabilities (CNBC)

• PayPal is attracting takeover interest after steep slide (BBG)

• Amazon to spend $12bn on AI data centers in Louisiana (CNBC)

• ASML unveils EUV light source advance that could yield 50% more chips by 2030 (RT)

• Novo Nordisk's obesity drug trial results disappoint, shares dive 16% (RT)

• SK Hynix vows to increase AI memory chip production to meet rising global demand (BBG)

CITRINI RESEARCH

A note from Citrini Research is doing the rounds – offering a hypothetical 2028 scenario of what they describe as a “Global Intelligence Crisis”, where AI advancements lead to significant productivity gains (but leaves us in the dust), driving sectors like Tech and Financials sharply lower overnight. Here are the key takeaways:

• The displacement spiral has no natural brake as AI improves, headcount falls, savings fund more AI, displaced workers flood gig roles and compress wages across the board

• Top 20% of earners drive ~65% of discretionary spend, so white-collar job losses punch far above their weight on consumption, with a lag as savings buffers mask the damage

• Intermediation moats built on human friction collapse, with DoorDash, travel platforms, real estate commissions and insurance renewals all disrupted by agents optimising 24/7

• Machine-to-machine commerce routes around the 2-3% card interchange via stablecoins, hitting Mastercard, Visa, Amex and mono-line issuers at the revenue model level

• $2.5 trillion in PE-backed private credit, much underwritten on perpetual ARR assumptions, begins defaulting in Q3 2027, Zendesk's $5bn facility marked to 58 cents is the smoking gun

• "Permanent capital" proves less stable than advertised, with life insurer annuity money sitting behind offshore reinsurance structures exposed to the same defaulting paper

TARIFFS & TRADE

• US trade policy uncertainty resurfaces after Supreme Court strikes down key tariff plans (CNBC)

• Trump aides express confidence in tariffs post-Supreme Court loss, aiming to replicate invalidated duties (NYT)

• US Customs and Border Protection to stop collecting tariffs after Supreme Court rules them illegal (RT)

• EU lawmaker urges postponement of US trade deal vote amid Trump's tariff chaos after Supreme Court ruling (CNBC)

• Trump lashes out at Taiwan for undermining US chip sector following SCOTUS defeat (SCMP)

CENTRAL BANKS

• Fed's Waller says rate cut in March is a 'coin flip' following a strong US jobs report (AP)

• ECB chief Lagarde says central bank's interest rate policy remains 'in a good place' (RT)

GEOPOLITICS

• Trump mulls targeted strike against Iran amid Geneva talks for a potential off-ramp (NYT)

• Iran signals readiness to make nuclear concessions to avoid potential US military strike (RT)

ECONOMY

• Severe winter storm disrupts US Northeast, signaling short-term economic slowdown; airports suspend flights (BBG)

• South Korea exports surge 23.5% in first 20 days of February (BBG)

ASX TODAY

Another busy day for corporate earnings, with quite a few $1-2bn names due to report, as well as Woodside. To manage the chaos of results, we're moving the usual coverage from here to the Live Blog.

WHAT TO WATCH TODAY

• BNPL: Very heavy overnight session for BNPL players, notable declines for Affirm (-7.8%) and Sezzle (-10.0%). NY Governor Hochul announced new regulation to establish comprehensive consumer protection for BNPL loans, including licensing and supervision frameworks, prohibit excessive fees and rules for timely resolution of consumer disputes

• Tech: Software stocks continued to get smashed overnight, with the iShares Expanded Tech-Software ETF down 4.7% (what’s worse is that it undercut the 5-Feb low, marking the lowest close since Nov-23). Lots of broad drivers including broad risk-off, Claude updates hitting cybersecurity and consulting sectors, and the Citrini report. 

• Gold: Another strong overnight session. Gold is now on a four-day win streak, up 7.2% to the highest since 30-Jan. VanEck Gold Miners ETF rallied 3.7% overnight, now 1.7% away from its 28-Jan record close.

BROKER MOVES

• Fisher & Paykel upgraded to Sector Perform from Underperform; target up to NZ$36 from NZ$31 (RBC)

• Imdex upgraded to Buy from Accumulate; target up to $4.70 from $3.70 (MORG)

• Imdex upgraded to Buy from Hold; target up to $4.60 from $3.60 (BP)

• McMillan Shakespeare downgraded to Neutral from Outperform; target cut to $16.40 from $19.69 (MMS)

Stocks trading ex-dividend: 

• Tue 24 Feb: AGL Energy (AGL) – $0.24, Amcor (AMC) – $0.93, Bega Cheese (BGA) – $0.07, Challenger (CGF) – $0.155, Deterra Royalties (DRR) – $0.124, MA Financial Group (MAF) – $0.14, Sports Entertainment Group (SEG) – $0.04, Ventia Services Group (VNT) – $0.125, Wesfarmers (WES) – $1.02

• Wed 25 Feb: Australian Finance Group (AFG) – $0.047, Codan (CDA) – $0.195, FSA Group (FSA) – $0.035, Maxiparts (MXI) – $0.042, Mystate (MYS) – $0.12, Ooh!Media (OML) – $0.04, Peter Warren Automotive (PWR) – $0.03, The Lottery Corporation (TLC) – $0.08, Telstra Group (TLS) – $0.105

• Thu 26 Feb: Beach Energy (BPT) – $0.01, BSP Financial Group (BFL) – $0.371, Gryphon Capital Income Trust (GCI) – $0.011, Ignite (IGN) – $0.03, IPH (IPH) – $0.19, JB Hi-Fi (JBH) – $2.10, Medibank Private (MPL) – $0.083, Mitchell Services (MSV) – $0.04, Pro Medicus (PME) – $0.32, Shape Australia (SHA) – $0.14, Universal Store (UNI) – $0.26, Whitehaven Coal (WHC) – $0.04, 360 Capital Mortgage REIT (TCF) – $0.05

• Fri 27 Feb: AMP (AMP) – $0.02, Australian United Investment (AUI) – $0.17, Carlton Investments (CIN) – $0.47, Diversified United Investment (DUI) – $0.07, Fiducian Group (FID) – $0.255, Orora (ORA) – $0.05, Pengana International Equities (PIA) – $0.014, Prime Financial Group (PFG) – $0.008

Other ASX corporate actions today:       

• Dividends paid: Transurban Group (TCL) 

• Earnings: Acrow (ACF), AMA Group (AMA), ARB Corporation (ARB), Artrya (AYA), AUB Group (AUB), BCI Minerals (BCI), Cedar Woods Properties (CWP), Cuscal (CCL), Dalrymple Bay Infrastructure (DBI), HMC Capital (HMC), Integral Diagnostics (IDX), Kelsian Group (KLS), MAAS Group Holdings (MGH), Mader Group (MAD), Monadelphous Group (MND), Nanosonics (NAN), Nine Entertainment Co. Holdings (NEC), Pacific Current Group (PAC), Propel Funeral Partners (PFP), Regal Partners (RPL), SKS Technologies Group (SKS), Southern Cross Media Group (SXL), Tasmea (TEA), Tyro Payments (TYR), Viva Energy Group (VEA), Vulcan Steel (VSL), Wagners Holding Co. (WGN), Woodside Energy Group (WDS)

• IPOs: None

• AGMs: None

Economic calendar (AEDT):

No major economic announcements.