Market update: 10 February 2026
Australian shares fell 1.8% this week after the RBA delivered a hawkish rate hike, signalling that inflation may stay above target for longer. This lifted expectations of further tightening and put pressure on rate-sensitive sectors. Technology, resources, utilities and telecommunications led the declines, while the Australian dollar rose 0.7% against the US dollar.
US markets ended mixed, with the Dow rising while the S&P 500 and Nasdaq edged lower. Despite broadly supportive macro data, market sentiment was weighed down by tech volatility, crypto swings and concerns around rising AI infrastructure spending. Software and AI-related stocks had their steepest three-day decline since April 2025 before a strong rebound in semiconductor shares helped lift markets on Friday. Bitcoin also swung sharply, tumbling midweek before bouncing back 11 percent. Smaller companies outperformed, and steady payroll inflows, fewer unemployment payments and expectations for larger tax refunds helped support the broader outlook.
European equities posted modest gains, supported by easing inflation and steady central bank policy. The European Central Bank and Bank of England both held rates steady. Retail sales softened but quarterly momentum improved, and market expectations for a UK rate cut as early as March continued to build.
In Greater China, markets finished lower, with the Shanghai Composite down 1.3 percent and the Hang Seng falling 3.0 percent. Modest gains in Private Purchasing Managers Indices were overshadowed by official numbers pointing to a broader slowdown in the economy. This reinforced expectations for more easing from the People’s Bank of China.
Japan’s Nikkei rose 1.7 percent, with sentiment supported by growing expectations that Prime Minister Takaichi’s Liberal Democratic Party will secure a majority in the upcoming election. That result could support political stability and increase the likelihood of further fiscal stimulus.
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