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Daily Update — February 18, 2026

Australia’s Carbon Leakage Review; AI’s Narrative Shift; and Declining Software Deal Activity

Today is Wednesday, February 18, 2026, and here’s your curated selection of Essential Intelligence on global markets from S&P Global. Subscribe to be notified of each new Daily Update.

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Energy Transition & Sustainability

Australia’s final carbon leakage review recommends CBAM-like scheme for high-risk sectors

 

Australia’s final carbon leakage review has proposed implementing a scheme similar to the EU's Carbon Border Adjustment Mechanism (CBAM) to mitigate carbon leakage in high-risk sectors. The review recommends a phased approach, piloting the scheme on specific steel products with suitable characteristics before expanding to the broader steel and iron group. The scheme would impose carbon tariffs on imports from countries with less stringent climate policies.

 

The review, released Feb. 13, highlights Australia's opportunity to level the playing field for traded heavy-industry commodities and to help establish a globally interoperable system. The Australian government will evaluate the recommendations as part of the 2026–27 review of the safeguard mechanism, suggesting they will not be implemented before then.

Artificial Intelligence

Credit FAQ: How Will AI Disrupt Software Sectors, Private Markets, And U.S. Credit Conditions?

 

The market narrative around AI has shifted from productivity tailwind to significant disruptor, prompting volatility in equity and credit markets. Investors are voicing concerns that AI advancements could disrupt software providers and are evaluating the risks of spillover to private credit players exposed to this sector.

 

In this credit FAQ, subject-matter experts at S&P Global Ratings discuss how AI-related disruption may affect traditional software sectors, private markets and US credit conditions. In their view, this disruption will differ across industries, depending on regulation and the resilience of business models.

Private Markets

Private equity's volume of software deals slowed as AI risks grew

 

Private equity and venture capital investment in application software declined in volume for the third consecutive year in 2025, down 21% year over year to 3,665 deals globally, according to S&P Global Market Intelligence data.

 

The sell-off of technology stocks in early February spotlighted the exposure of alternative asset managers to the software sector. Scott Denne, a senior research analyst at S&P Global Market Intelligence 451 Research, said the turbulence was driven by rising anxiety among public market investors that AI-powered automation could trim software company growth and diminish valuations.

In case you missed it

  • After Insurify released what it called "the insurance industry's first ChatGPT app," US insurance broker stocks took a hit on Wall Street, with the S&P 500 US Insurance Brokers Index falling 10.7% from Jan. 30 to Feb. 12.
  • Oversupply, India's plan to cut imports and the Lunar New Year holiday further widened the discount for seaborne Russian crude cargoes offered to China's independent refineries, Chinese refiners and traders told Platts, a part of S&P Global Energy.
  • The surge in European bank M&A activity raises questions about its impact on credit conditions, with potential benefits and challenges for the financial markets.

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