Daily Market Update: 5 January 2026

The S&P/ASX 200 Index (ASX: XJO) edged 3 points higher to close at 8588.2, halting a three-day losing streak, though the index remains down 1.3 per cent for the week. A late-session rebound in technology stocks helped the market stay afloat, despite four of the eleven sectors finishing in negative territory. The local tech sector staged a recovery, aided by gains in WiseTech Global Limited (ASX: WTC), up 1.6 per cent to $68.04, and Xero Limited (ASX: XRO), which rose 2.5 per cent to $113.04. However, other tech names like NextDC Limited (ASX: NXT) and Megaport Limited (ASX: MP1) slipped, while Life360 Inc (ASX: 360) extended its downward trend, closing at a six-month low.

Focus turns to domestic data amid mixed sector performance

Investors are now turning their attention to domestic economic indicators ahead of November inflation data due Wednesday, which could shape expectations for the Reserve Bank of Australia’s (RBA) next interest rate move. Despite a rise in precious metals, the materials sector lagged due to an 8.6 per cent fall in Northern Star Resources Limited (ASX: NST) after it downgraded production guidance. In corporate news, Nickel Industries Limited (ASX: NIC) rose 7.8 per cent following a strategic investment from South Korea’s Sphere, and Mesoblast Limited (ASX: MSB) gained 1.8 per cent amid leadership changes. Judo Capital Holdings Limited (ASX: JDO) rose 4.4 per cent as it reaffirmed its full-year profit guidance.

Global markets mixed amid AI volatility and economic optimism

Wall Street began 2026 with a volatile but mostly positive session, as investors weighed the outlook for AI investment and broader economic strength. The Dow Jones Industrial Average (INDEXDJX: DJI) rose by 370 points, supported by gains in core sectors, while the S&P 500 Index (INDEXSP: .INX) added 0.2 per cent and the Nasdaq 100 Index (INDEXNASDAQ: NDX) ended flat. Chipmakers rallied, with NVIDIA Corporation (NASDAQ: NVDA) up 2 per cent, and Micron Technology Inc. (NASDAQ: MU) and Intel Corporation (NASDAQ: INTC) jumping 10 and 7 per cent respectively. Meanwhile, AI software stocks like Microsoft Corporation (NASDAQ: MSFT), Meta Platforms Inc. (NASDAQ: META), Amazon.com Inc. (NASDAQ: AMZN), and Palantir Technologies Inc. (NYSE: PLTR) fell sharply. Tesla Inc. (NASDAQ: TSLA) dropped 2.5 per cent after missing delivery targets, while signs of economic resilience and anticipated rate cuts from the Federal Reserve underpinned broader market sentiment.