Trump weighs software export curbs as China trade tensions rise

Good morning. Here's what happened overnight and what you need to know today.

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1.

Software block: The Trump administration is considering a plan to restrict exports to China of goods made with or containing US software, Reuters reported citing a US official and three people briefed by US authorities. The measure, which may not move forward, is reportedly one of several options being weighed in response to China’s expanded rare earth export controls. If adopted, it would follow through on Donald Trump’s threat earlier this month to impose new export controls on “any and all critical software” and 100% tariffs on Chinese shipments by 1 November. One source told Reuters the measure could be announced to pressure China but not implemented, while narrower proposals are also under discussion. “Everything imaginable is made with US software,” one of the sources said, highlighting the wide scope of the potential move. US stock indexes fell on the news. The threat follows China’s new rare earth controls and comes ahead of a planned meeting with Xi Jinping in South Korea. (Reuters)

2.

Software spat: Wall Street slid Wednesday as tech stocks came under pressure, Netflix earnings disappointed and a report of potential US software export restrictions to China fuelled renewed trade tensions. The Nasdaq was trading 1.6% lower in the late afternoon, while the S&P 500 was 0.94% lower and the Dow down 0.85%. Investor jitters were amplified by reports the Trump administration is considering curbs on exports to China of a wide range of US-made software, including ERP, CRM and CAD systems, in response to Beijing’s rare earth restrictions and new port fees on US ships. Technology and communication services stocks led losses. Netflix tumbled 10% after a Brazilian tax dispute hit earnings. Texas Instruments fell as much as 9.8% on a downbeat forecast. Tesla, which will report after the bell (3Q profit is expected to fall 25% from a year ago), was down 1.5%. Gold continued its slide, falling 1.7% to USD4,054.34 after Tuesday’s 5.3% plunge, as traders booked profits following a 57% year-to-date rally and ahead of US inflation data. Beyond Meat swung wildly, ending lower after a sharp intraday surge in classic meme stock fashion. (Bloomberg)(Reuters)(WSJ)

3.

Tech update: Google said it achieved a breakthrough in quantum computing, running a verifiable algorithm on its Willow chip that performed a task 13,000 times faster than the world’s best supercomputer. Published in Nature, the “Quantum Echoes” algorithm was used to compute the structure of molecules and could support advances in areas like drug discovery and materials science. Google said the algorithm is repeatable on other quantum platforms, calling it a step toward real-world applications within five years. Meanwhile, Reddit filed a lawsuit in New York federal court against Perplexity AI and three data-scraping companies (SerpApi, Oxylabs and AWMProxy) alleging they bypassed data protection measures to illegally collect Reddit content via Google search results. The platform, which licenses its data to OpenAI and Google, is seeking monetary damages and a stop court order. And Meta told employees it will cut about 600 roles from its Superintelligence Labs unit, affecting teams in AI research, infrastructure and product development. That came as Amazon’s chief technology officer for Amazon Robotics Tye Brady told Bloomberg a recent New York Times report claiming the company planned to replace about 600,000 human jobs with robots was only “speculating” over what could happen in the next 10 years. He also spoke about the launch of Blue Jay, Amazon’s new warehouse robot. (Google)(NYT)(Reuters)(Bloomberg)(Axios)(Amazon)

4.

Russia-Ukraine war: Russia conducted major training exercises involving nuclear weapons on Wednesday, one day after a scheduled summit between Presidents Donald Trump and Vladimir Putin in Budapest was put on hold. The Kremlin said the test included the launch of a land-based ‘Yars’ intercontinental ballistic missile from a cosmodrome, the launch of a ‘Sineva’ ballistic missile from a nuclear submarine and the launch of nuclear-capable cruise missiles from strategic bombers. “All training objectives were successfully accomplished,” the Kremlin said. Sources told Reuters that the talks were delayed after Russia reiterated its terms for a peace deal, including Ukraine’s cessation of the entire southeastern Donbas region, rejecting Trump’s comments last week that both countries should freeze current front lines. Russia also announced plans to use reservists to defend civilian infrastructure while Putin ordered the size of the regular army to expand to 1.5 million active servicemen. Meanwhile, seven people were killed, including two children, by Russian strikes on Ukraine on Tuesday night. (Capital Brief)(The Kremlin)(Reuters)

5.

Abort abort: Macquarie is set to change course on controversial plans to remove asset managers overseeing less than $300 billion from its superannuation wrap platform, as prominent investor Magellan confirmed it has held talks with the financial services behemoth over the controversial move. Three industry sources who spoke to Capital Brief on the condition of anonymity said they expect Macquarie to backtrack on the $300 billion threshold given it would cut most Australian fund managers from the platform, a significant distribution channel. Magellan Financial Group CEO Sophia Rahmani on Tuesday confirmed she was in talks with Macquarie in a bid to escape the axing, telling shareholders at the company's AGM she expects the outcome of those discussions to be “positive”. Magellan manages $39.6 billion, according to its latest ASX disclosure, well short of the mooted $300 billion threshold. The AFR first reported that Macquarie could remove asset managers under the threshold from the wrap platform. (Capital Brief)

6.

Koala bared: Koala co-founder and CEO Dany Milham says returning to the company has been grounding after a turbulent few years that saw him care for his dying father, very publicly launch and bomb a startup, and then step back into the business that started it all. “Koala’s always been my life’s work,” Milham told Capital Brief. Milham left Koala in 2019 after his father was diagnosed with stage-four cancer. He spent a year in Byron Bay caring for him before launching Milkrun, the high-speed grocery delivery service that became one of the most hyped and scrutinised Australian start-ups of the pandemic era. The intense media coverage that followed Milkrun’s 2023 collapse was difficult for Milham because of what it signalled to younger founders. Since his return, Koala has posted record results. In the year to June 2025, Koala’s revenue climbed 42% to $276 million, while EBITDA increased almost threefold to $13.5 million. (Capital Brief)

7.

Grassroots round: Medical AI startup Heidi is allocating a slice of its recent USD65 million ($100 million) Series B round to Melbourne VC firm Archangel Ventures in a seldom seen “community round” that will offer eligible users of its platform the opportunity to invest. Heidi’s customers – ranging from independent clinicians to government health organisations – will be able to make minimum investments of USD5,000, provided they are based in Australia and qualify as sophisticated or professional investors. Early-stage investor Archangel, which has participated in each of Heidi’s investment rounds, is set to manage the two-week process, with expressions of interest closing on 7 November. Archangel has set up a special purpose vehicle using investing platform GXE, which will allow sophisticated investors to buy the same class of shares on the same terms as the recent Series B which closed earlier this month. Point72 Private Investments, Blackbird Ventures, Headline and Latitude Ventures participated in the round. (Capital Brief)

8.

Shadowed exit: Just a week after delivering an ambitious vision for Australia's tech future at SXSW Sydney, Tech Council of Australia CEO, Damian Kassabgi, resigned from his position, ending a short and sometimes uneasy 16-month tenure. As Capital Brief’s Bronwen Clune noted, his time at the lobby group was marked by an uneasy power dynamic with chair Scott Farquhar, whose influence often overshadowed the CEO role. That imbalance became most apparent in July, when Farquhar used a National Press Club address to call for sweeping copyright reform without consulting Council members, prompting internal backlash and a public walk-back. Kassabgi, a former Afterpay executive based in Byron Bay, was seen by some as lacking the startup credentials of a board made up of founders who had built companies from scratch into global players. “A startup staffer in the right place at the right time,” a source told Clune. Others described moments of prickliness between Kassabgi and Farquhar in meetings and member calls, though both were careful to leave no sign of discord publicly. The Council now faces the task of finding a CEO who can either operate comfortably within Farquhar’s influence or bring enough independent stature to hold their own — a rare commodity in Australian tech. (Capital Brief)