Halftime Report Podcast Summary

Episode: How Far Can the Rally Run?
Date: February 9, 2026
Host: Scott Wapner
Panel: Joe Terranova, Jim Lebenthal, Steve Weiss, Brin Talkington
Special Guests/References: Jensen Huang, Brad Gerstner

Episode Overview

This episode explores the durability and sustainability of the ongoing stock market rally, with the Dow breaching 50,000 and the S&P 500 Equal Weight hitting new records. The panel dissects what’s driving the broadening rally beyond mega caps, debates valuation risks, addresses AI and software stock volatility, and examines the impacts of recent deleveraging events — including in crypto markets. They discuss tactical trades, sector rotations, and where opportunity or danger may lie as the market looks toward key economic data ahead.

Key Discussion Points & Insights

1. Market Milestones & Sentiment Check

• [01:02-03:05] The Dow at 50,000, S&P Equal Weight at all-time highs.
  • Scott opens: “Dow's higher than 50k, S&P, equal weight, record high. And Ed Yardeni says you ain’t seen nothing yet. He says Dow 70K by 2029…a growth story mode.”
  • Joe: Reiterates robust fundamentals — “If you look at the revenue growth, look at earnings growth for the 60% of the S&P 500 that have reported so far, it is incredibly robust…this is a pretty good setup.”
• Critical data ahead: Labor and inflation prints later in the week could set the tone.

2. Equal Weight S&P (RSP) and Sector Leadership

• [03:05-04:50] Brin on RSP: “You let it run…Even if you do own RSP, it’s somewhat equal weight by security, but not by sector. Industrials are over 16%...broader exposure and AI connectivity.”
• Migration from cap-weighted mega caps to broader market participation.

3. Valuation Tensions & AI Premiums

• [04:50-06:52] Steve Weiss: "Valuations are too high. Would have been good to see the market base for a little bit."
• Scott pushes for specifics; Weiss calls out Microsoft and Caterpillar: “Anything that’s still associated with AI is getting those premium valuations.”
  • [07:04] — Melius downgrades Microsoft: “Satya lost the narrative.”
    • Weiss: “It's too early to say that Nadella has lost the narrative. It's early, early days. They've shown a willingness to spend. They've got the relationships.”
• Debate on free cash flow and AI spending: Referencing interviews with Jensen Huang and Brad Gerstner.

4. AI Spending: Bubble or New Paradigm?

• [10:01-14:15]
  • Jensen Huang (Nvidia, quoted): “Appropriate and sustainable. And the reason for that is because all of these companies’ cash flows are going to start rising. ...every incremental investment is something that there is a return on.”
  • Jim: Buys more Oracle (despite recent downgrades): “If you believe the numbers in 2028, [Oracle] is trading at something like 14 times earnings and for that growth rate, it's a bargain.”
• Comparisons to the dot-com era: Major investors note PTSD over prior bubbles, but distinguish current cash-flow visibility, e.g. “unlike dark fiber.”
• Brad Gerstner (quoted): “The only way that reverses...companies have to accelerate their core revenues and show that they are beneficiaries of AI.”

5. Software Sector Woes & Differentiation

• [14:15-19:45]
  • Jim adds to Oracle and Adobe, defends their business model against “bubble” talk: “How many PDFs have you opened this morning? Adobe is not getting replaced anytime soon...At 13 times earnings, Adobe is not getting replaced.”
  • Weiss disagrees: “Adobe can be replaced...you can design that same security by using Claude or whatever. That's why you can't buy the stock.”
  • Panel consensus: Software is “too hard” for broad ETF bets—focus must be selective.
  • Brin: “ServiceNow...you just have to have and they have a strong moat.”

6. Debt Markets & Hyperscaler AI Momentum

• [19:45-21:07]
  • Joe: Oracle’s recent $20 bn investment grade debt offering “was a record... strong demand.”
  • Hyperscalers (Alphabet, Meta) issuing billions in debt, signaling institutional optimism about their long-term positioning.

7. Private Credit, Tech Lending & Opportunities

• [21:07-23:50]
  • Brin: Added Blue Owl Technology Finance (OTF) — “Yield is around 13% today—a great way to play technology.”
  • Weiss: Sees IPO pipeline as key for private credit returns. “All the private equity firms are poised to outperform...underwrite responsibly.”

8. Crypto Crash & The Deleveraging Narrative

• [24:10-27:59]
  • Scott/Joe/Brin: Debate what caused the recent crypto wipeout (Bitcoin 69k, under 70k again).
    • Brin: “A good old fashioned massive margin call...I think we’ll find out when all the 13F come out what actually happened here.”
  • Bernstein (via Scott, quoting a note): "Bitcoin bear case is the weakest in its history."
    • Weiss: (Skeptical) “If Adobe's in the too hard bucket, bitcoin is in the impossible bucket. Nobody's been able to tell me what the intrinsic value is here...There’s no there there.”
    • Scott: “It’s digital gold. It’s digital gold...until gold looks pretty good and then, well, gold is gold.”

9. Tactical Trade Updates & Panel Moves

• [30:03-35:06]
  • Weiss: Sells Uber (“frustration”; concern about margin compression via Robotaxi partnerships), trims Netflix (“dead money”), holds Blue Owl.
  • Joe: Adds to Corning — citing strong technicals and a $6 bn multi-year relationship.
  • Jim: Buys more Cleveland Cliffs (CLF): “Stock down 17% today, but...look forward. Volumes, prices up, costs down. 2026 looks great even as short-term price action is rough.” Emphasizes transformative acquisitions and expected cash flow acceleration.

10. ETF Innovation Amid Crypto Volatility

• [37:21-39:58]
  • Mackenzie Segallos with ETF Edge and Will Rhind (GraniteShares):
    • “A lot of leverage in the system...as AI trades lose value, scared a lot of people…Deleveraging affected crypto.”
    • Crypto-product innovation focus now on options, multi-asset or leveraged ETFs—vanilla spot products “done.”

11. Super Bowl Betting Boom

• [40:28-43:50]
  • Contessa Brewer: “Record highs in Super Bowl trading volumes...sportsbooks saw over 42% jump in betting volumes year-on-year.”
  • Novelty bets—hundreds of thousands wagered on coin toss outcomes.

12. Final Market Thoughts

• [44:27-45:00]
  • Mike Santoli: “Market rebalancing after old economy vs new. ...The S&P has sort of acted as if it’s been capped...a stall phase while majority of stocks outperform the index.”
• Panel’s “Final Trades” [47:12-47:30]:
  • Brin: Info (asset-light infrastructure via royalties/toll booths)
  • Weiss: Amazon (“think it bounces”)
  • Jim: Transocean (“told you two weeks ago”)
  • Joe: Interactive Brokers (ready for new all-time highs)

Notable Quotes & Memorable Moments

• “You let it run... Even if you do own RSP, it’s somewhat equal weight by security, but it’s not by sector.” — Brin, [03:31]
• “Valuations are too high. Would have been good to see the market base for a little bit.” — Steve Weiss, [06:02]
• “Satya lost the narrative.” — Scott, quoting analyst on Microsoft, [07:05]
• Jensen Huang (Nvidia): “Appropriate and sustainable. The reason for that is because all these companies’ cash flows are going to start rising…every incremental investment is something there is a return on.” [10:01]
• “If you believe AI is a bubble, you're not going to believe the ‘28 numbers for Oracle…if you listen to what Jensen Huang said, you’re going to say to yourself, yeah, I believe.” — Jim, [12:38]
• “Adobe is not getting replaced anytime soon…At 13 times earnings, Adobe is not getting replaced.” — Jim, [14:15]
• “Adobe can be replaced…you can design that same security by using Claude or whatever. That's why you can't buy the stock.” — Weiss, [16:55]
• “If Adobe's in the too hard bucket, bitcoin is in the impossible bucket.” — Weiss, [26:49]
• “I bought this stock on dips before, Steve...You wanted to stage an intervention. It was funny, but it was inaccurate.” — Jim (on Cleveland Cliffs), [33:06]

Major Segment Timestamps

• [01:02-03:05] Market rally context & economic setup
• [03:05-04:50] Equal-weight index & sector leadership
• [04:50-06:52] Valuations and AI premium debate
• [10:01-14:15] AI investment thesis, Oracle/Adobe, bubble vs. paradigm
• [24:10-27:59] Bitcoin, crypto crash, and the “problem bucket”
• [30:03-35:06] Panel’s individual stock moves & rationale
• [37:21-39:58] ETF industry, crypto innovation
• [40:28-43:50] Super Bowl betting surge, sports gambling trends
• [44:27-47:30] Closing market views & final trade picks

Takeaways

• Confidence in the bull run is grounded in broadening participation and strong fundamentals, yet significant caution remains regarding stretched valuations, particularly in AI and software.
• Panelists remain tactical: preserving winners but also opportunistically adding in dislocated names (Oracle, Adobe, Corning, CLF).
• Private credit and crypto both exhibit signs of stress from leverage, but also create buying opportunities for selective investors.
• Market remains in “digestion phase”—rotation is healthy, but overextension in certain narratives (AI, crypto, software) fuels debate.
• Betting and trading activity outside equities (crypto, Super Bowl) reflects a still-risk-seeking environment.

For more day-to-day market action and deeper dives into catalysts affecting stocks, tune in to Halftime Report weekdays at noon ET.