Australian shares fell at market close on Friday, as the technology sector fell on concerns over artificial intelligence-caused disruption, tracking losses on Wall Street.

The S&P/ASX 200 index fell 1.39%, or 125.90 points, to close at 8,917.60.

On Wall Street, the S&P 500 and the Dow Jones fell 1.6% and 1.3%, respectively, while the Nasdaq Composite declined 2% on Thursday.

On the domestic front, Australia's household spending rose 0.5% in January, driven by spending on recreation and necessities like summer events, fitness, and travel, according to the Commonwealth Bank of Australia's Household Spending Insights report.

November and December 2025 data for the Australian labor market do not show a re-tightening but a "solid" finish to the year, Westpac said. Due to re-emerging inflation pressures and a lack of further interest rate support, the bank also expects a "flatter" employment growth and for the unemployment rate to rise gradually during the year.

In company news, Austal's (ASX:ASB) shares fell over 22% on market close after the firm said that an overstatement of around $17.1 million had been included in its fiscal year 2026 earnings before interest and taxes (EBIT) guidance. It updated its EBIT guidance for fiscal year 2026 to around AU$110 million.

Cochlear (ASX:COH) reported fiscal first-half 2026 underlying earnings of AU$2.978 per basic share, down from AU$3.139 a year earlier. Total revenue for the six months ended Dec. 31, 2025, was AU$1.17 billion, flat compared with a year earlier. Its shares fell nearly 19% on market close.

Lastly, Webjet (ASX:WJL) said it has ceased discussions with BGH Capital and Helloworld Travel (ASX:HLO) regarding any potential takeover. The company had received an offer of AU$0.90 per share from Helloworld in November 2025, followed by an offer of AU$0.91 per share from BGH Capital. Its shares fell over 25% on market close.