Closing Bell Overtime: Four-Year Anniversary of the Bull 10/12/26

Salesforce

Across the shows: 2 speakers in other episodes, 1 bullish and 0 bearish calls, past 30 days

• Tal Liani · BofA SecuritiesBullish

  Salesforce's comprehensive AI offering makes it a double upgrade; AI is a growth tailwind.

  Large enterprises are not switching away from their systems of record, governance and data, and they need an orchestration layer and a new language interface to deploy AI. Liani rates Salesforce's AI offering among the best because it covers all four layers. He sees Salesforce as using AI as a growth tailwind, while enterprise AI deployment is still very small. He expects growth to accelerate for the next few quarters, but not to double digits next year. He says software companies can rally if they prove a valid, profitable AI strategy. Growth timing is the main risk.

  “we are saying it is one of the best in the market because it's comprehensive. It offers a solution for all four layers.”at 11:50

Adobe

Across the shows: 1 speaker in other episodes, 1 bullish and 0 bearish calls, past 30 days

• Tal Liani · BofA SecuritiesBearish

  Adobe sees AI as a major headwind rather than a tailwind.

  Liani sorts software companies into those where AI is a tailwind and those where it is a headwind. He puts Adobe in the headwind group, in contrast to Salesforce and ServiceNow, which he sees using AI for growth. This is the basis for his double upgrade of Salesforce alongside a negative view of Adobe. The argument is qualitative and does not include a specific estimate.

  “In my view, companies like Adobe [are] seeing AI as a major headwind, while companies like Salesforce and ServiceNow are using, could be using AI as a tailwind for growth.”at 13:27

Microsoft

Across the shows: 5 speakers in other episodes, 4 bullish and 1 bearish calls, past 30 days

• Kate Rooney · CNBCUncertain

  Microsoft's in-house Maia chips cut its Nvidia reliance, but scale faces material and talent bottlenecks.

  Microsoft's third-generation Maia 300 chip can process up to seven times more AI tokens per data center rack than its predecessors and is more power efficient. It is aimed at internal workloads such as Copilot, to cut costs. Evercore estimates homegrown chips could be about 10% of Microsoft's AI chip spend by early next year. Microsoft will keep using Nvidia and AMD, so the relationship is a frenemy one. Rooney notes bottlenecks in raw materials and in talent, with rivals such as OpenAI and Anthropic also bidding for the same people. Her overall view is uncertain.

  “The company says these Maya 300 chips can process up to seven times more AI tokens per data center rack versus its predecessors.”at 20:39

NVIDIA

Across the shows: 25 speakers in other episodes, 22 bullish and 7 bearish calls, past 30 days

• Kate Rooney · CNBCBullish

  Custom chips from hyperscalers haven't dented Nvidia's share; the AI chip pie is growing.

  Amazon, Google, Microsoft, OpenAI and Anthropic are all building custom chips to compete with Nvidia. Rooney says this has not taken any real share from Nvidia, and the total pie seems to be growing. Hyperscalers still rely on Nvidia and AMD for training. So far, custom silicon is adding to the market rather than replacing Nvidia.

  “It has not dented into NVIDIA's market share at all really, and the pie seems to be growing.”at 22:29

Citigroup

Across the shows: 2 speakers in other episodes, 2 bullish and 0 bearish calls, past 30 days

• Jason Goldberg · BarclaysBullish

  Citigroup is the cheapest large bank with room to beat its ROTC target this year.

  Goldberg says Citi has the most upside among large banks because less is expected of it. The top 10 banks would trade at their lowest valuation with Citi included, and it has room to improve. Citi has driven its returns higher and set a 10-11% ROTC target for the year. Barclays expects it to beat that target even though third-quarter capital markets revenue may be somewhat sluggish.

  “You know, more room to improve. They have done a good job in terms of driving their returns higher, and we expect them... You know, they came out with a 10 to 11% ROTC target for the year. We expect them to be above that”at 42:04

Banks

• Jason Goldberg · Barclays

  US big banks' fundamentals are solid, with record Q3 loans and deposits, holding margins and benign credit.

  Goldberg argues the bank selloff is not driven by the banks' own business. Loans and deposits should reach record levels this quarter, net interest margins are holding, fee income is up year over year, credit quality is very benign, and companies keep buying back stock. He expects trading and investment banking results to come in somewhat better than feared, and says he is constructive overall, with a slight preference for the bigger banks, and that capital-markets concerns may already be priced in.

  “The fundamentals are solid. Right? Loans and deposits are gonna be at record levels this quarter. Net interest margins holding in. ... Credit quality, very benign, and and the companies continue to buy back stock. So the fundamental story is solid.”at 38:54

• Jason Goldberg · Barclays

  AI agents moving deposits won't threaten banks near term; banks will adapt as they did before.

  Asked whether AI agents could move deposits to higher-yielding accounts at other banks, Goldberg says that is certainly not a near-term risk. He points to five decades of product change in banking, including money market funds and cash accounts, and argues banks will adapt to whatever is thrown at them. Competition from banks and non-banks is always present, but he sees no change in that dynamic from AI.

  “Certainly not in the near term. I think you have seen a lot of changes throughout the banking industry over the last, say, fifty years in terms of new products, new services, the introduction of money market funds... and banks will have to adapt.”at 39:58

• Jason Goldberg · Barclays

  Banks will help finance the AI infrastructure buildout, supporting healthy capital-markets activity for 18–24 months.

  Goldberg argues the AI infrastructure buildout needs a lot of capital, and banks will finance part of it through their own balance sheets and by raising debt and equity, with private credit also playing a role. Citing the internet buildout and railroads, he says such investment tends to happen when it is profitable. He expects about 18 to 24 months of healthy activity, with fits and starts along the way, and sees early benefits to banks already.

  “There's a lot of capital needed to finance this AI infrastructure build out. Banks will play a part of that, certainly on their own balance sheet and then raising money in both the debt and equity markets.”at 42:44

• Jason Goldberg · Barclays

  Bond-portfolio losses will pressure bank capital but not create a 2023-style Silicon Valley problem.

  Rising rates create unrealized losses in banks' bond portfolios. Goldberg expects book value to grow more slowly this quarter, with pressure on capital ratios and possibly smaller buybacks as banks prioritise loan growth. He says the group has managed multiple rate jumps in recent years. Unlike Silicon Valley Bank in March 2023, which had about 90% uninsured deposits and no contingent liquidity, the banks still standing are much healthier, so the risk is not idiosyncratic.

  “Yeah, it's, you know, value will be tougher to grow this quarter. You'll see some pressure on capital ratios.”at 43:44

US elections & politics

• Monica Guerra · Morgan Stanley Wealth Management

  Affordability and gas prices are voters' top midterm issue and could hurt the president's party.

  Guerra says that after two months of meeting clients across the wealth spectrum, affordability is the top issue everywhere. She is tracking gas prices, because a sustained increase of 10 cents or a dollar or more can hurt the sitting president's party. The sitting party on average loses 32 House seats in a midterm, so the energy-price backdrop matters for the election.

  “Affordability is the top issue. I've been traveling all around the country the last two months meeting with clients.”at 32:55

• Monica Guerra · Morgan Stanley Wealth Management

  Gridlock midterms historically favour stocks, with divided government outperforming other setups.

  Guerra argues that a split Congress with a Democratic House or Senate and a Republican president has typically outperformed other congressional and presidential combinations by about 18%. A divided Congress and presidency means little new legislation can pass, so policy risk is contained. A red sweep historically performs worse, but Guerra says the comparison needs context, such as the Nixon era. The macro backdrop, not politics, is what is really driving markets.

  “when we're thinking about the potential for a gridlock government, which is where we're headed... you're looking at typically outperformance versus other congressional presidential scenarios about 18%.”at 33:39

• Monica Guerra · Morgan Stanley Wealth Management

  Supreme Court ruling leaves election disputes to states; Senate races matter most, House impact marginal.

  Guerra says the Supreme Court has stabilised things. It let states decide how to handle an executive order encouraging voter-roll scrubbing, treating it as a states' rights issue. Because states manage their own elections and results, she expects any pushback to keep being handled state by state, which lowers the risk of post-election distrust. The Senate races are where investors are focused, while the House impact should be more marginal.

  “And so from that perspective, we view that any pushback is gonna continue to be handled on that state by state basis.”at 37:44

US stock market outlook

• Max Kettner · HSBC

  Tactically lean into equal-weight S&P 500 and the broadening theme as bonds calm.

  Multiples have compressed across the Nasdaq and S&P 500 under higher yields, and sentiment is too skeptical given record S&P 500 companies raising guidance. If Treasury yields stop spiking, earnings broadening should help. Kettner therefore favours leaning into the equal-weight S&P 500 and playing the broadening theme tactically, beyond semiconductors, into the coming earnings season. The view depends on yields calming.

  “So to me, it's a bit leading into leaning into the equal weight S and P again and playing tactically a little bit that broadening theme again.”at 7:20

• Michael Santoli · CNBC

  Mega-cap dominance has likely run its course unless broader market weakness develops.

  Only about 34% of large stocks have outperformed the S&P 500 over the past year, near a historic low, according to Adam Parker. Santoli notes that broad outperformance periods have tended to coincide with market weakness. The equal-weight-style XMAG, which holds the S&P 500 excluding the Magnificent Seven, is holding up. Santoli concludes the mega-cap period has likely run its course unless broader weakness comes, so stock pickers may get their chance and index holders may face a dead-money period.

  “So I do think there are many things that are saying, look, this mega cap dominant period for the market has kind of run its course unless we're gonna have some broader weakness here.”at 28:49

AI infrastructure & data centers

• Max Kettner · HSBC

  Market can't bet on AI capex lifting rates while also doubting AI earnings; the contradiction matters.

  Some rates strategists argue AI investment is lifting nominal GDP growth and therefore the structural floor for rates, pushing the 10-year toward 6%. Others say stocks cannot rise because AI is disappointing. Kettner says both cannot hold at once. If AI capex is strong enough to lift the economy's growth and rates, that is a problem for equities, so the bearish arguments are internally inconsistent.

  “You can't tell me that AI is so great and AI CapEx are so great, it lifts our star. And at some point, that's gonna be a problem for equities.”at 8:53

• Monica Guerra · Morgan Stanley Wealth Management

  Congressional scrutiny of AI data centers could create a buying opportunity, since legislation is unlikely to pass.

  The AI trade has run up sharply, so headlines about hearings or political pressure on AI data centers could cause volatility. Guerra argues that this would be a potentially attractive entry point because nothing is likely to pass through Congress, so the broader economic cycle would not be derailed. Executive orders, however, can move markets fast, which changes the old relationship between politics and markets.

  “One area could be in AI data centers. ... We would say, you know, that is potentially a really attractive entry point because it doesn't necessarily derail the broader economic cycle.”at 35:27

Credit markets

• Max Kettner · HSBC

  Credit and EM risk premia already repriced sharply, setting up better risk sentiment.

  Triple-C credit spreads are above 1,000 basis points and trading in distressed territory. Popular EM credit names have sold off 10 to 14 points. Kettner argues this means considerable destruction of multiples and risk premia has already happened across the board. That repricing is the reason sentiment is poor and supports a better setup for risk assets.

  “You look at credit. You look at triple c's. They're already trading above 1,000 basis points. They're already trading well in distressed territory.”at 5:27

Earnings & corporate profits

• Max Kettner · HSBC

  Q3 S&P 500 earnings growth should roughly match Q2, not weaken materially.

  A record number of S&P 500 companies have raised guidance just ahead of Q3 earnings, and nominal GDP is tracking 7-8%. Kettner says it makes no sense for earnings to weaken sharply in that setting. He expects Q3 not to be materially weaker than Q2 and possibly to match it, though he concedes the large one-off markups seen in Q2 will not repeat. Sentiment is too negative, which sets up a positive earnings reaction.

  “I'd be very, very surprised if q three was materially weaker than q two. We might even match q two.”at 7:02

US growth & recession risk

• Max Kettner · HSBC

  Fading 2026 fiscal support will bring negative economic surprises in 2027, easing yields.

  The US economy has had large cyclical fiscal support this year from tax refunds, tariff refunds and incentives under the One Big Beautiful Bill, which are underestimated by the market. Much of that support will not repeat in 2027. Kettner expects this fiscal impulse to turn negative and produce the first negative economic surprises. That would help yields fall and support risk assets across credit, equities and EM.

  “I actually do think that people really, really do underestimate how much cyclical fiscal support we've thrown up on the economy this year in terms of tax refunds, tariff refunds. ... A lot of that fiscal support will not repeat in 2027.”at 9:18