Tech stocks boost ASX after Nvidia wows Wall Street; Qantas falls

The Australian sharemarket has opened higher, extending Wednesday’s rally after Nvidia, the US chipmaker at the heart of the artificial intelligence revolution, again posted results that blew Wall Street expectations out of the park, soothing concerns about the AI boom.

The S&P/ASX 200 rose 37.50 points, or 0.4 per cent, to 9165.60 as of 10.51am AEDT, led by technology shares. The ASX jumped 1.2 per cent to close at a record high on Wednesday. The Australian dollar was trading at US71.20¢ at 10.54am AEDT.

Qantas shares climbed as much as 4.1 per cent before swinging 3 per cent into the red, after the airline reported record half-year earnings of $1.46 billion as less fuel-hungry Airbus planes are replacing its ageing domestic fleet. The result was up $71 million on the previous half and slightly above analysts’ expectations. The board also announced a share buyback of as much as $150 million.

In other earnings news, fund manager Perpetual rose 1.9 per cent after reporting a rebound in first-half net profit to $53.9 million, an increase of more than $40 million from the same half last year, when its profits were hit by significant items.

Super Retail shares rallied 7.3 per cent after the company posted a 4.2 per cent lift in half-year sales to $2.2 billion, even though statutory profits fell 19.8 per cent. Its Macpac stores saw the greatest growth of Super Retail’s four brands, lifting sales by 13.1 per cent, followed by Supercheap Auto, which grew 5.1 per cent. Rebel’s sales gained 4.8 per cent, while BCF lifted 0.3 per cent.

And pharmacy giant Sigma Healthcare jumped 5.2 per cent after saying its profits were up 19.2 per cent to $392 million in the December half, as sales at its 550 Chemist Warehouse stores jumped 17.2 per cent to $5.1 billion.

Mining stocks also advanced after iron ore prices climbed overnight. BHP set a fresh record yet again, climbing 2.5 per cent to trade close to $58. Rio Tinto gained 3.3 per cent. Lynas Rare Earths rose 3.3 per cent after reporting a big jump in production, sales, revenue and profit, to $80.2 million, for the half year to December. CEO Amanda Lacaze said Western governments’ efforts to fix rare earth supply challenges meant Lynas – as the only commercial producer outside China today – was in a good position to “capture the full value of this market upside.”

But it was tech stocks that once again powered the rise on the local market, tracking gains by their US peers. Software maker WiseTech Global, which on Wednesday said it would slash about a third of its workforce as developers are being replaced by AI, jumped 4.2 per cent. Accounting software makers Xero and TechnologyOne were up 5.1 per cent and 2.4 per cent, respectively, and AI data centre operator NextDC jumped 1 per cent.

On Wall Street overnight, US stocks rose and erased their losses for the week so far, as bullish profit expectations for Nvidia boosted technology stocks. The AI chipmaker, which has become the US market’s largest stock by value, didn’t disappoint when it released its results after the closing bell.

Its fiscal fourth-quarter sales surged 73 per cent from the previous year to $US68.1 billion ($95.7 billion) while profit nearly doubled to roughly $US43 billion. It also flagged roughly $US78 billion in revenue this quarter, when analysts were seeing less than $US72.3 billion. Its shares, up 1.4 per cent during the session, added another 1.5 per in after-hours trade.

The stock helped push the S&P 500 up 0.8 per cent for a second straight gain after Monday’s swoon, when shares dropped as investors tried to separate potential losers from winners in the AI boom. The Dow Jones Industrial Average rose 0.6 per cent, and the Nasdaq composite climbed 1.3 per cent.

Nvidia’s profit reports have become a bellwether for global markets, not only because it’s so big but also because of how influential the AI boom has broadly become over their moves. In past years, the AI frenzy helped stocks run to record after record amid hopes that it would revolutionise the economy and make it more productive.

More recently, though, concerns have climbed about whether companies like Alphabet and Amazon are spending so much on chips from Nvidia and other equipment that they’ll never be able to make back the investments through future gains in productivity. If that leads to a pullback in spending, it would hit Nvidia directly. The chipmaker’s latest report alleviated such near-term worries.

“Our customers are racing to invest in AI compute — the factories powering the AI industrial revolution and their future growth,” Chief Executive Officer Jensen Huang said.

Investors have also begun focusing on companies and industries that could get undercut by AI-powered competitors, selling off stocks seen as potentially under threat, and spasms have rolled through industries as seemingly disparate as software, trucking logistics and legal services.

That’s on top of other worries already weighing on the market, including new tariffs announced by US President Donald Trump to replace ones struck down by the Supreme Court.

“While those concerns are real, we believe investors would be wise to balance them out with offsetting trends that may be underappreciated in the current wall of worry headline cycle,” said Darrell Cronk, chief investment officer for Wealth & Investment Management at Wells Fargo.

Among them is the solid growth in profit that US companies have been reporting so far for the end of 2025. That has helped strengthen corners of the US stock market that had earlier been overshadowed by AI mania and Big Tech, including stocks of smaller companies.

with AP, Bloomberg

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