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Highlights

  • ASX All Technology Index plunges up to 8.3%, marking steepest drop since February 24.

  • Tech shares follow sharp declines in U.S. markets amid renewed tariff concerns.

  • Year-to-date, AXIJ down 27.6%, underperforming ASX 200’s 12% slide.

Australian tech stocks were hammered in early trading Monday, with the ASX All Technology Index (XIJ) falling as much as 8.3%, hitting its lowest level since 15 February 2024. The sharp drop places the index on track for its biggest intraday percentage loss since late February, deepening the year’s already substantial declines.

The selloff follows a bleak lead from U.S. stock futures, which opened significantly lower on Sunday evening (AEST), hinting at continued market turbulence sparked by former U.S. President Donald Trump's recent tariff announcement. The two-day slide last week wiped trillions from global equity markets, and Australian tech shares are now mirroring that sentiment.

Major Names Dragged Lower

Leading the sector's retreat are some of Australia’s top tech players:

  • Xero Ltd (ASX:XRO) fell 4.5%, under pressure from investor risk aversion and tech sector headwinds.

  • WiseTech Global Ltd (ASX:WTC) tumbled 6.6%, making it one of the worst performers in the morning session.

At the time of writing, the XIJ index was down around 5.6%, cementing a grim start to the week. The index has now lost 27.6% year-to-date, sharply underperforming the ASX 200, which is down approximately 12% over the same period.

Global Jitters Weigh on Sentiment

The sharp reversal in sentiment is being driven by fears of renewed trade tensions, following Trump’s surprise proposal last week to reintroduce significant tariffs on imports should he return to office. The announcement has reignited fears of a global trade slowdown, a scenario that tends to hit high-growth and export-reliant tech companies hardest.

Analysts are warning that volatility may persist until there is greater clarity on the policy direction in the U.S. and its potential knock-on effects for global trade and investment flows.