ASX Market Wrap: Tech Sectors Boom on AI Adoption and Pro Medicus (ASX: PME) Double-Win as Housing Market Stalls

Key Highlights

• S&P/ASX 200 slips 0.11% despite a powerful rally in technology stocks

• Information Technology sector surges 4.85%, led by Pro Medicus (ASX: PME), Xero (ASX: XRO) and WiseTech Global (ASX: WTC)

• Pro Medicus (ASX: PME) secures A$44 million in new US healthcare contracts

• Australians recorded one million AI subscription payments over the past year, according to Westpac data

• National housing growth stalls as Sydney and Melbourne property prices retreat

• Brent crude climbs above US$93 a barrel amid ongoing Middle East uncertainty

Technology stocks carry the market as broader index drifts lower

Monday’s market session revealed two very different Australian economies.

On one side sat a slowing housing market, cautious consumers and pressure on interest rate sensitive sectors. On the other, a technology sector riding a wave of artificial intelligence adoption and fresh enterprise software spending.

At 1:11pm AEST, the S&P/ASX 200 was down 0.11% to 8,721.7 points, while the broader All Ordinaries eased 0.03% to 8,961.9. The weakness at the headline level masked a sharp divergence underneath.

The ASX All Technology Index jumped 3.40% to 2,936 points, making it the standout performer of the session.

The rally followed another constructive finish on Wall Street, where the S&P 500 recorded its ninth consecutive weekly gain, its longest winning streak since late 2023. The Dow Jones rose 0.72% to 51,032.46, while the S&P 500 added 0.22% and the Nasdaq gained 0.20%.

ASX Sector Snapshot | Source: MarketIndex 

Pro Medicus powers technology surge

The strongest catalyst for local technology shares came from healthcare imaging software leader Pro Medicus (ASX: PME).

Shares climbed 8.53% to $143.54 after the company unveiled two major US contract wins worth a combined A$44 million.

The first was a five-year A$28 million contract renewal with Allegheny Health Network, extending a partnership that now spans more than a decade. The agreement includes higher minimum transaction commitments and increased fees per transaction, highlighting the company’s ability to command stronger pricing as customers deepen their reliance on its platform.

The second agreement is a seven-year A$16 million contract with TidalHealth across Delaware, Maryland and Virginia. Alongside its traditional imaging products, TidalHealth selected Pro Medicus’ cardiology platform, broadening the company’s reach beyond radiology.

The strength in Pro Medicus spilled across the broader software sector. Xero (ASX: XRO) rose 8.14%, WiseTech Global (ASX: WTC) gained 7.39%, while SiteMinder (ASX: SDR) advanced 8.86%.

Australia’s AI adoption accelerates

Part of the enthusiasm surrounding technology shares was supported by fresh data showing artificial intelligence is rapidly moving into everyday business and consumer activity.

Westpac transaction data revealed Australians made around one million payments for AI subscriptions over the past year. More than 150,000 customers paid for at least one AI-related service, with monthly spending reaching approximately A$5.6 million.

The figures suggest AI tools are moving beyond experimentation and becoming embedded in workplaces, small businesses and personal productivity routines.

HSBC Australia and New Zealand Chief Economist Paul Bloxham said improving productivity remains one of Australia’s biggest economic challenges.

“AI will not save the economy from a near-term downturn, which is needed to get inflation down, but it could help to increase potential growth in the medium-term. Australia’s biggest economic challenge has been weak productivity.”

Property market loses momentum

Away from technology, housing data painted a softer picture of the domestic economy.

National dwelling values stalled during May, ending a run of steady gains that had stretched back to early 2025.

Sydney home prices fell 0.9% during the month, while Melbourne declined 0.8%. Auction clearance rates also weakened across major states, reflecting reduced buyer activity under higher borrowing costs.

The softer housing backdrop weighed on Real Estate stocks, which fell 1.03%, while Financials lost 0.89%.

Telecommunications was the weakest sector, down 1.81%.

Energy and geopolitics remain in focus

Commodity markets continued to respond to developments in the Middle East.

Brent crude rose 2.13% to US$93.07 a barrel, while WTI crude climbed near US$89 as traders assessed supply risks linked to regional tensions and shipping routes.

Commodities Price Index | Source: MarketIndex 

JPMorgan chief US economist Michael Feroli said energy markets remain vulnerable even if geopolitical tensions ease.

“While uncertainties remain, the acute risk phase for the global economy should be over if tankers can begin moving again through the Strait of Hormuz. Still, not everything would return to its pre-conflict place. Oil prices are likely to remain elevated for some time.”

Gold slipped 0.50% to US$4,518 an ounce as funds rotated back toward equities.

Market movers

Among the day’s strongest performers, Challenger Gold (ASX: CEL) rose 11.11% after continuing to benefit from recent funding and development progress. Catapult Sports (ASX: CAT) climbed 10.24% as demand for sports performance analytics remained strong.

At the other end of the board, DroneShield (ASX: DRO) fell 10.77% after disclosing an ASIC information request tied to an ongoing investigation. Northern Minerals (ASX: NTU) dropped 6.25% as the market continued to digest recent foreign ownership developments.

As winter trading begins, Monday’s session highlighted a growing divide within the Australian market. Property, financials and defensive sectors are grappling with slower economic momentum, while software and AI-linked businesses continue attracting capital as companies search for productivity gains in a higher-cost world.