CNBC Halftime Report Podcast Summary

Episode: "Navigating the Tech Sell-Off"
Date: February 3, 2026
Host: Scott Wapner
Investment Committee Panelists: Joe Terranova, Stephanie Link, Shannon Saccocia, Josh Brown
Key Topics: Tech sector sell-off, disruptive AI news, sector rotation, market outlooks, notable trades (especially in energy and materials), and the Nvidia–OpenAI relationship.

EPISODE OVERVIEW

This episode centers on the sharp sell-off affecting the technology sector, especially mega-cap and software stocks, against the backdrop of high-profile earnings and disruptive AI developments. The panel dissects the drivers behind this volatility—including new AI tools, sector rotation, and souring investor sentiment—and explores tactical shifts into industrials, energy, and materials. Notable market narratives like the Nvidia–OpenAI “drama,” Palantir’s resilience, and big trades (e.g., Devon Energy, PulteGroup) are also unpacked.

KEY DISCUSSION POINTS & INSIGHTS

1. The Tech Sell-Off: Drivers and Perspective

• Market Context:

  • Nearly a quarter of the S&P 500 reports earnings this week, with a focus on Alphabet (best performer) and Amazon (worst).
  • Tech is “getting hit really hard”—NASDAQ down over 1.3%. All major mega-caps are negative.
  • [01:00] Scott Wapner: “NASDAQ is down more than one and a third percent and tech's getting hit really hard… All of the mega caps are down.”

• The Panel's Take on Recent Tech Moves:

  • Josh Brown [02:11]:

    “Some of the most popular trades of the previous uptrend just get absolutely nuked.”

    • Sellers are indiscriminately targeting high-flyer tech stocks and institutional favorites.
    • Even strong company earnings offer little protection.
    • “Risk appetite is coming out of anything that has to do with technology.”
    • Ground zero: application layer in the software stack (cybersecurity, SaaS, etc.), regardless of vertical or market cap.

• Cannibalization From AI: Anthropic's Tool Shake-Up

  • AI legal tool from Anthropic causes notable pain for SaaS and data analytics players—stock drops in Intuit, DocuSign, Snowflake, Twilio, Service Titan, even exchanges and data providers.

  • Joe Terranova [05:23]:

    “The cannibalization in software—it’s absolutely real… and also is the data service names… This is a real theme. I don’t think it goes away in 2026.”

    • He highlights software earnings lagging tech sector earnings by ~15%.
    • His team has slashed software exposure, holding tech at historic lows in their portfolio.

  • Panel Commentary [07:36 and after]:

    • Investors debate whether the sell-off is overdone; some sense “the cutting board just moved lower.”
    • Cybersecurity (e.g., Palo Alto, Crowdstrike) may be a possible exception and potential opportunity.

2. Rotation Out of Tech: Where Is the Money Going?

• Elevated volatility & a “rotational bull market”:

  • Joe Terranova [06:44]:

    "Industrials doing well, energy doing well, materials doing well... If you're staring at an overweight [in software], it's time to take down that positioning."

• Strong Macro Data:

  • Stephanie Link [08:51]:

    “We got Chicago PMIs, we got ISM yesterday on manufacturing… all blew out expectations... means the overall economy is doing well.”

    • Rotation justified by surprising strength in the U.S. economy, driving flows into cyclicals.

• Selectivity in Software/Cybersecurity:

  • Stephanie Link [07:36]:

    “I actually think that the cyber companies are buyers right here… you talk to chief technology officers and they are spending on AI and they're spending on cybersecurity.”

    • Main caveat: software lacks any near-term catalyst to dispel structural fears.

• Alternatives to Tech Abound:

  • Shannon Saccocia [09:25]:

    “If there was no alternative to technology… maybe you could step into some of these names, Scott. But there’s plenty of other places to go.”

3. Tech Market Structure: Liquidation, Credit, and Valuations

• Indiscriminate selling, especially in smaller tech names & software borrowers:

  • Josh Brown [10:43]:

    “It’s indiscriminate, it’s liquidation, it’s sector-wide... they don’t really care right now what the difference is from one versus the other.”

    • Highest quality, large-cap names expected to bottom first.

  • Private lenders (Ares, KKR, Blue Owl) hammered on concerns for software firm loans—Ares down 11%, Blue Owl down 10%.

  • Josh Brown [12:23]:

    “We switched from, ‘Oh my God, it's a bubble in data centers’ to, ‘Wait a minute, a lot of these businesses might be worth way less...’ That shift took four days.”

  • "Physical" economy sectors (commodities, energy, etc.) are seen as relatively safe (“things you really can’t disrupt with the software reboot” - [13:44]).

  • Parallels drawn between current private credit/software issues and post-COVID commercial real estate crisis ([14:10] Shannon).

4. Nvidia–OpenAI Relationship: Market Overreaction?

• Headlines and Reports:

  • Tension reported after Jensen Huang refuted a supposed $100B Nvidia-OpenAI commitment; OpenAI allegedly dissatisfied with Nvidia’s chips.
  • Reuters story, Sam Altman (OpenAI CEO) social post:

    “We love working with Nvidia and they make the best AI chips in the world. We hope to be a gigantic customer for a very long time. I don't get where all this insanity is coming from.” [18:29]

• Expert Analysis:

  • Christina Partsinevelos [15:50]:
    • Two separate deals; Nvidia’s investment is in tranches contingent on OpenAI's data center buildout.
    • OpenAI diversifies chip providers (AMD, Broadcom, Cerebras), but Nvidia still dominates.
    • Defensive moves by both parties, but relationship is stable.
  • Kate Rooney [18:29]:
    • “They do not want any perception out there that they have issues with Nvidia... would cause major problems for OpenAI.”
  • Live audio from Jensen Huang [40:26]:

    “We love working with OpenAI. We are incredibly honored and delighted to be able to invest in their next round... It’s complete nonsense [that there’s tension].”

  • Panel consensus: drama is overblown; market’s allergic reaction is about broader AI disruption anxieties.

5. Software Outliers: Palantir and Defensive Names

• Palantir:

  • Strong earnings, upgraded to outperform, +7% on the day.
  • Joe Terranova [21:40]:

    “70% revenue growth for this company… one of the software names that will survive the AI automation that's cannibalizing…”

    • Still, not breaking out amid sector-wide malaise—most software names are compressing in valuation.

• Zoom:

  • Cited as another defensive software holding, pulling back to key technical levels but still a rare outlier showing support.

6. Away from Tech: Energy, Industrials, and Housing

• Energy:

  • Josh Brown [24:04]:
    • New buy: Devon Energy (DVN); highlights share buybacks, debt retirement, yield, breaking multi-year downtrend.

    “This is the type of stock they’re gravitating to when they come out of the Oracles and the Microsoft… snapping a downtrend since May 2022… very little overhead resistance left here for Devon.”

• Industrial/Materials/Other Defensive Names:

  • Best stocks highlighted: Targa Resources (TRGP), WW Grainger (GWW), Corteva (CTVA, forming a “golden cross”).
  • Emphasis: these sectors are “not disruptible by AI” ([36:14] Josh).

• Housing:

  • PulteGroup:
    • Added to Joe Terranova’s ETF after a period on the sidelines.

    “Return on equity, the debt to equity, very strong… building back into the builders once again.” [43:15]

  • Stephanie Link: maintains housing exposure via D.R. Horton, Toll Brothers; optimistic on sector tailwinds, possibly supported by public-private partnership programs ([44:38]).

7. Analyst Calls and Rotations

• JP Morgan:

  • Upgraded to neutral at Baird (with a price target below current level).
  • Josh Brown [30:25]:

    “Over the next couple of years it's a $500 stock... This is a core position for me… upgrade, downgrade, blah, blah, blah, company’s paying a nice dividend, buying back stock, executing. I just, I tune it out.”

• Boeing:

  • Bank of America reiterates Buy; “execution story,” improved free cash flow ([29:42] Stephanie).

NOTABLE QUOTES & MEMORABLE MOMENTS

• Indiscriminate Tech Sell-Off:

  • [02:11] Josh Brown:

    “I’m looking at some of the most widely traded, most popular stocks amongst both retail and institutionals… just nuked, one after another.”

• Anthropic AI Cannibalization:

  • [05:23] Joe Terranova:

    “The cannibalization in software—it’s absolutely real… earnings for [software] are trailing the earnings for technology overall as a sector by about 15%. That's clearly troubling.”

• Macro-Driven Rotation:

  • [08:51] Stephanie Link:

    “We got PMIs on manufacturing all blew out expectations… The overall economy is doing well, better than people thought. And you want to own cyclicals, and that's why you are seeing this rotation.”

• On Software Investor Mindset:

  • [09:14] Shannon Saccocia:

    “There has to be some evidence for you that they can turn the corner on those revenues and grow in the second half… there’s plenty of other places to go.”

• Private Credit Hit:

  • [11:47] Josh Brown:

    “…those that have lent money to software firms, these stocks are getting crushed… the losses across the board here today are pretty dramatic.”

• On Nvidia–OpenAI 'Drama':

  • [18:29] Sam Altman (quoted):

    “We love working with Nvidia and they make the best AI chips in the world. We hope to be a gigantic customer for a very long time. I don't get where all this insanity is coming from.”

  • [40:26] Jensen Huang (live):

    “It’s complete nonsense. We love working with OpenAI… we would love to be invited to invest for each one of their rounds…”

TIMESTAMPS FOR IMPORTANT SEGMENTS

• [01:00] – Market context; Tech/mega-cap sell-off begins
• [02:11] – Panel analysis of the tech and software wipeout
• [04:03] – Anthropic’s new AI tool and its ripple effect
• [05:23] – The cannibalization of SaaS, data providers, and impacts on earnings
• [11:47] – Sell-off reaches private credit/lenders
• [12:23] – Shift from “data center bubble” to “tech disruption panic”
• [15:50] – Christina Partsinevelos on Nvidia–OpenAI “split”
• [18:29] – Kate Rooney and Sam Altman’s reassurance on Nvidia–OpenAI
• [24:04] – Josh Brown on shifting into Devon Energy
• [36:14] – Josh Brown’s new picks: Targa, Grainger, Corteva
• [40:26] – Jensen Huang’s live comment on OpenAI relationship
• [43:15] – Homebuilders talk: PulteGroup and sector rationale
• [46:50] – Panelists’ “Final Trades”

SUMMARY OF MARKET SENTIMENT & PANEL TONE

• Tone:

  • Candid, occasionally anxious, focused on tactical adaptability. Mix of wariness (“don’t catch a falling knife” in software), realism (“they don’t really care right now what the difference is from one versus the other”), and some optimism for cyclicals and “real economy” stocks.

• Overarching Message:

  • Tech’s pain is acute, likely driven by real fundamental shifts (AI disruption, softening growth, over-ownership), and software especially is “guilty until proven innocent.”
  • Investors shouldn’t feel obliged to “buy the dip” in software—opportunities elsewhere in energy, housing, and select industrials/materials are more attractive.
  • Headline-grabbing drama (e.g., Nvidia–OpenAI) may not have much behind it, but the broader anxiety reflects a market struggling to price in disruption’s pace and impact.

FOR LISTENERS SHORT ON TIME

If you want the core takeaways:

• Tech is under indiscriminate selling pressure—especially software and companies adjacent to AI disruption (thanks to Anthropic’s tool).
• Rotation out of tech toward cyclicals (energy, materials, housing) is strong, amid resilient macro data.
• Panel emphasizes selectivity and diversification; little appetite to “buy the dip” in lagging software.
• Nvidia–OpenAI rift is overblown; both sides reaffirm partnership.
• Key new trades: Devon Energy, PulteGroup, “boring” industrial leaders.
• The market’s narrative has shifted rapidly from tech exuberance to caution—and panelists recommend treading carefully.

This summary captures the heart of CNBC’s Halftime Report as it navigated the tech sell-off on February 3, 2026, distilling sector-shaping moments, strategic rotates, and the panel’s direct, no-nonsense debate.