CNBC "Fast Money" Podcast Summary

Episode Title: Tech, Software Sell Off… And The Impact On Private Credit
Date: February 3, 2026
Host: Melissa Lee
Panel: Tim Seymour, Carter Worth, Steve Grasso, Julie Beal
Special Guests: Andrew Davis (Bryn Mawr Trust Advisors), Evan David Segerman (BMO), Wilma Burdis (Raymond James)

Episode Overview

This episode dives into a broad tech and software sector selloff and its ripple effects across markets, especially on private credit asset managers. The panel discusses causes behind the tech weakness—fears around the AI trade, competition within the sector, and valuation concerns. The episode also covers knock-on effects for private credit, pharma sector developments (notably Novo Nordisk’s slump), resilience in consumer staples, homebuilder rallies, and notable company-specific moves. Guests provide insight into macro trends, credit market risks, and sector rotation strategies.

Key Discussion Points

1. Tech and Software Selloff

• Markets in the Red: The Nasdaq fell nearly 1.5% as money rotated out of tech and into defensive sectors like transports, staples, and utilities.
• Semiconductors & Software: Both sectors were sharply lower. AI euphoria cooled, with questions about revenue, monetization, and valuation.
• EV/Revs Valuations: Software traded north of 30x revenue before the selloff, now facing doubts about sustaining growth.

Quote:
“We’ve priced in euphoria across the entire space… especially in software, you had the group trading on an EV to revenues probably north of 30 times before this pullback began. There's a lot of questions about monetization even for some of the biggest companies.”
— Tim Seymour [02:41]

Debate: Is This a Real Rotation or Early Signs of Fear?

• Rotation Opportunity: The panel notes positive breadth and strength in other sectors despite tech weakness.
• Asymmetric Cyclical Link: Carter Worth stresses that semiconductors and software are complementary but cycle differently—risk is that a deflation in one could precipitate a broader market decline.
  Quote:
  “The risk for the market is that the euphoria that’s in semis—ultimately the air comes out of that… If the air comes out of that because they are linked, the market cannot endure that.”
  — Carter Worth [04:33]
• Small Cap Rally: Discussion about investors rotating into small caps and S&P 600 for quality over the broader Russell 2000.
• Unease Over Partnerships in AI: Nvidia/OpenAI drama is seen as overblown, but points to industry uncertainty.

Notable Moment:
Julie Beal compares the sector’s competitive drama to "Melrose Place," noting,
“It almost feels like Melrose Place… where the interwoven relationships between people… friends or foes… Part of it is I think a lot of the buying… in semiconductors is defensive—to protect from anyone else getting and being able to fortress your capacity.” [07:44]

2. AMD & Semi Earnings

• AMD: Beat earnings expectations with guidance factoring China sales, but the market was unimpressed given recent stock run-up.
• Product Ramp: The real acceleration is expected in late 2026, especially with GPU buildouts.
• Market Reaction is Key:
  “There is no such thing as good or bad results. There are only results, and it’s how the market reacts... if the stock is down, it is. The results are bad.”
  — Carter Worth [12:52]

3. Software Stocks Crash & AI Disruption Concerns

• IGV ETF: Down nearly 5% on the day, now off 19% YTD, with names like Intuit, Salesforce, and Akamai hit hard.
• AI’s Double-Edged Sword: Fear that new AI tools could disrupt and displace traditional software models, but reality is more complicated.
• Cautious Optimism: Some see this oversold scenario as a contrarian buying opportunity, particularly in premier names like Microsoft and ServiceNow.

Quote:
“I buy or I sell CEOs… I don’t want to sell a Bill McDermott [ServiceNow]. I don’t want to sell a CRM that’s down 25% in three months. So I think the market overreacts… I’d be a buyer of software here.”
— Steve Grasso [16:45]

4. Macroeconomic & Sector Rotation Viewpoints

• Andrew Davis (Bryn Mawr Trust Advisors): Sees the tech sell-off mirroring macro data—"slower hiring, questioning of discretionary spend.”
• Momentum vs. Caution: Despite small-cap rally, Davis cautions not to get overextended on optimism. Recommends focusing on "quality," e.g., S&P 600 over Russell 2000.
  Quote:
  “We would just push back gently… it’s right to have a little caution around that.”
  — Andrew Davis [18:16]

5. Novo Nordisk & Pharma Selloff

• Novo Nordisk: Shares drop 14.5% following weak guidance, driven by pricing pressures and competition in the US obesity market (Ozempic’s exclusivity loss).
• Read-through: The selloff affected the entire GLP-1 space.
• Long-term View: Volume is key, but short-term profitability concerns dominate.
  “The minute price really starts to come into the equation, that means your earnings visibility disappears.”
  — Julie Beal [28:13]
• Chart Perspective:
  “This is a bad setback… I would call this a failed bearish to bullish reversal. I would abandon it.”
  — Carter Worth [28:41]

6. Private Credit: Collateral Damage from Tech?

• Credit Asset Managers (Blue Owl, Aries, TPG): Stocks slump over concerns about tech/software exposure as AI disrupts the sector.
• Wilma Burdis (Raymond James): Downplays risks due to strong underwriting and equity buffers in these loans.
• Concerns Remain:
  • Carter Worth warns: “These are the most cyclical assets there are… during the bear market of 2022, all lost 50%. Something’s wrong. They're in trouble. I would not step in the way right here.” [37:50]
  • Julie Beal is cautious: Risks of default or overbuilding in a tech transition always exist.
• Tim Seymour: Notes possible spillovers into leverage loans and broader credit markets.

7. Other Notable Company Moves & Sectors

• Walmart: Joins $1 trillion club, powered by e-commerce.
• Bitcoin: Drops below $72K; technical breach raises risk of further weakness.
  Quote:
  “The burden of proof is on the bull. The slippage continues and the question is just how much more… it can be quite a bit more. Buyer beware.”
  — Carter Worth [31:54]
• Chipotle: Beats on earnings but same-store sales contract; digital ordering remains a pain point for sales growth.
• Homebuilders: Rally on reports of private “Trump Homes” program aimed at affordability. Panel prefers broader plays (Home Depot, Simpson) over single builders at these valuations.

Notable Quotes & Timestamps

| Time | Speaker | Quote | |--------|----------------------|--------------------------------------------------------------------------------------------| | 02:41 | Tim Seymour | “We’ve priced in euphoria across the entire space… especially in software...” | | 04:33 | Carter Worth | “The risk… is that the euphoria in semis… if the air comes out… the market cannot endure.” | | 07:44 | Julie Beal | “It almost feels like Melrose Place… where the interwoven relationships between people…” | | 12:52 | Carter Worth | “There is no such thing as good or bad results... only results, and it’s how the market reacts.”| | 16:45 | Steve Grasso | “I buy or I sell CEOs… I’d be a buyer of software here.” | | 18:16 | Andrew Davis | “We would just push back gently… it's right to have a little caution around that [rotation].”| | 28:13 | Julie Beal | “The minute price starts to come into the equation… your earnings visibility disappears.” | | 28:41 | Carter Worth | “This is a bad setback. I would call this a failed bearish to bullish reversal. I would abandon it.”| | 31:54 | Carter Worth | “The burden of proof is on the bull. The slippage continues… Buyer beware.” | | 37:50 | Carter Worth | “These are the most cyclical assets there are… Something's wrong. They're in trouble.” |

Timestamps for Important Segments

• AI, Semi & Software Selloff: 00:44–07:44
• AMD Earnings Reaction: 10:08–13:45
• Software/AI Disruption Deep Dive: 13:45–17:35
• Macro & Small Cap Rotation Discussion: 17:35–21:37
• Novo Nordisk/Pharma Selloff: 23:14–28:52
• Private Credit Risks Explored: 33:49–39:49
• Bitcoin, Chipotle, Homebuilders, Other Movers: 31:54–45:11
• Final Trade Ideas: 45:24–46:05

Summary Takeaways

• **The tech/software trade has reached a valuation reckoning, with high revenue multiples unsustainable amid growth and margin concerns. Defensive sectors are benefiting from rotation, and panelists debate whether this is a healthy correction or an omen.
• **AI’s promise has sparked both investment euphoria and new risks, especially for legacy software and investor sentiment.
• **Private credit is under scrutiny for software risk, but established firms argue strong loan-to-value structures and underwriting quality mitigate real downside. Contrarian voices remain skeptical.
• **Macro strategies prioritize quality over momentum chasing, even as small and mid-caps outperform in early 2026.
• **Stock-specific analysis highlights both buying opportunities (oversold software; Walmart, Jack Henry) and warnings (Novo, private credit assets, semiconductors).

Final Trade Highlights:

• Julie Beal: “Jack Henry reported good results today… I don't see it [AI] replacing banking cores anytime soon.” [45:24]
• Tim Seymour: “I feel pretty comfortable nibbling back into the software part of this trade…” [45:32]
• Carter Worth: “Sell semis extended.” [45:44]
• Steve Grasso: “Q2 holdings is the way. I’m taking a risk here; please use a stop if you buy the stock.” [45:57]

Overall:
This episode of "Fast Money" captures a pivotal moment of sector rotation, valuation realignment, and caution around both the boom and the bust potential of new tech trends. The panel’s insightful, at times skeptical, analysis offers investors actionable perspectives on navigating the shifting market landscape.