Morning Wrap: ASX 200 to tumble, S&P 500 now negative for 2026, REA misses earnings

ASX 200 futures are down 100pts (-1.14%) as of 8:30 am AEDT.

In a nutshell:

• Major US benchmarks broadly lower, closing near worst levels

• Another defensive day, with Staples and Utilities eking out a small gain while Discretionary and Tech trade sharply lower

• Commodity prices tumbled overnight amid elevated volatility

• REA Group reported 1H26 results, which broadly missed market expectations

Let's dive in.

S&P 500 SESSION CHART

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

OVERNIGHT MARKETS

• Major US benchmarks lower, closed at worst levels

• Defensive rotation continues as Staples, Utilities, Real Estate outperform growth-y pockets of the market by a wide margin

• Equal-weight S&P 500 (-0.87%) outperformed the cap-weighted index by 39 bps, also closed at fresh all-time highs on Thursday

• Today's selloff largely attributed to intensifying tech weakness, now spreading to broader tech sector as well as US JOLTs job openings printing the lowest since September 2020 and Challenger layoff data surging to the highest level since 2009

• Financial data stocks lower after Anthropic touts latest Claude model that can tackle complex financial research (BBG)

• Big tech CEOs are looking to ease AI disruption fears of software names as stock rout continues (YF)

• Nvidia and Arm CEOs dismiss fears about AI cannibalising software companies (BBG)

• US software sector ETF loses almost $1tn in past seven days (BBG)

• Bitcoins extends declines, dips below US$67,000 (CNBC)

• Private capital giants warn AI fears could slow fundraising, delay asset sales until 2027 (FT)

• Surging market volatility fuels hiring at hedge funds and banks for volatility arbitrage specialists (BBG)

• Silver prices tumbled 16% on Thursday, analysts point to speculation and leveraged trading for volatility (BBG)

• Yen posts worst week as Japan election looms (RT)

• Saudis cut oil price for Asian buyers to lowest since 2020 (BBG)

STOCKS

• Alphabet reports 18% Q4 revenue jump, plans aggressive capex to boost AI capacity (BBG)

• Qualcomm revenue guidance misses, memory chip shortage to impact smartphone supply, shares dip 8% and down 25% since early Jan (CNBC)

• Arm Holdings anticipates slower revenue growth despite increased demand for its AI data center chip designs (BBG)

• Snap revenue top estimates amid growth in total active advertisers, guidance falls short, shares dive 13% to 2019 low (RT)

• Gemini to cut workforce by 25% and shut operations in UK, EU and Australia as part of America First push (RT)

• HP, Dell, Acer and Asus weigh sourcing memory chips from China amid global supply crunch (NK)

• Foxconn anticipates strong Q1 performance, driven by AI rack shipments and better-than-expected smart electronics (RT)

• Shell announces $3.5bn share buyback and dividend raise despite weaker oil prices (FT )

• Maersk's Q4 operating profit meets expectations, management warn falling freight rates may impact 2026 earnings (BBG)

• Baidu approves up to $5bn buyback over three years, plans maiden dividend (BBG)

TARIFFS & TRADE

• US hosts critical minerals summit with VP Vance saying administration plans to use tariffs to establish price floors (NBC )

CENTRAL BANKS

• Fed's Bostic reiterates support for restrictive policy as job market 'super strong' (MSN)

• ECB holds rates as expected, markets price just 25% chance of a cut this year (FT)

• Warsh predicts AI boom will boost economy, enabling aggressive Fed rate cuts (FT)

• Fed Governor Cook sees inflation risks tilting higher, signaling opposition to rate cuts (RT)

• RBA seen hiking again as metals slump clouds Australian dollar outlook near-term (BBG)

GEOPOLITICS

• US and Russia agree to re-establish high level military-to-military dialogue (AP)

• Rubio urges Iran to prepare for significant US negotiations; talks to focus on nuclear, missiles (FT)

ECONOMY

• US December job openings came in at 6.5m vs. 7.25m ests, now at the lowest since 2020, rate of job openings also fell to 3.9% month-on-month vs. 4.2% in November (BBG)

ASX TODAY

• Carnarvon Energy to buyback up to 10% of outstanding shares over the next 12 months from 20-Feb (CVN)

• News Corp reports Q2 earnings, revenue up 6% to $2.36bn vs. $2.30bn ests, adjusted EPS up 21% to 40 cents vs. 37 cent ests (NWS)

• REA Group reports H1 net profit up 9% to $340.6m vs $344.1m ests, interim dividend of $1.24 vs $1.35 ests, announces buyback of up to $200m, management flag FY26 national Buy listing volumes to fall 1-3% (REA)

WHAT TO WATCH TODAY

• Materials selloff continues: Local miners already started to selloff on Thursday, with the S&P/ASX 200 Materials closing 3.3% lower. However, commodity price weakness continued overnight, with silver down ~16% to US$72/oz, gold down 3.3% to US$4,800/oz, copper down 3% to US$5.76/lb and more. Pretty much all overnight resource-related ETFs down 5-6%, so brace for some further weakness. It's getting pretty ugly out there!

BROKER MOVES

• Breville Group upgraded to Overweight from Neutral; target up to $35.50 from $33.30 (JPM)

• Beach Energy downgraded to Sell from Neutral; target cut to $1.05 from $1.15 (UBS)

• Treasury Wine Estates downgraded to Sell from Neutral; target cut to $4.75 from $5.25 (UBS)

Stocks trading ex-dividend: 

• Fri 6 Feb: None

• Mon 9 Feb: BKI Investment Company (BKI) – $0.04

• Tue 10 Feb: Sandon Capital Investments (SNC) – $0.005

• Wed 11 Feb: ResMed (RMD) – $0.059

• Thu 12 Feb: Korvest (KOV) – $0.25

Other ASX corporate actions today:       

• Dividends paid: Arena REIT (ARF)

• Earnings: REA Group (REA)

• IPOs: MB Gold (MBG) 

• AGMs: None

Economic calendar (AEDT):

No major economic announcements.