Closing Bell Overtime: Tech’s Rally Comes Undone 10/22/26

Tesla

Across the shows: 14 speakers in other episodes, 12 bullish and 6 bearish calls, past 30 days

• Gene Munster · Deepwater Asset ManagementBullish

  Tesla's FSD attach rate rising from 15% to 70% shows adoption is accelerating, though still nascent.

  Munster notes autonomy is about 1% of total ride-sharing miles. He cites Tesla's FSD attach rate rising from about 15% three years ago to about 70% today. He concludes that something bigger is going on, while acknowledging that the technology is still nascent. He treats this as part of the broader case that AI and physical AI are early and bigger than the market recognises.

  “The attach rate for FSD has gone from about fifteen percent three years ago to 70% today. Something bigger is going on, still nascent.”at 11:22

Meta Platforms

Across the shows: 33 speakers in other episodes, 34 bullish and 13 bearish calls, past 30 days

• Gene Munster · Deepwater Asset ManagementBullish

  Zuckerberg's conviction that Muse becomes central signals confidence; Meta is a buy on this sell-off.

  Munster notes Meta has about 10 million daily active users of Muse, and Zuckerberg is basing the company's foundation around it next year. He treats this as small today but likely to grow to billions of daily users. He reads Zuckerberg's claim that the company's centre of gravity will be Muse in a year as a sign of confidence, and says the statement would be a concern only in isolation. Other leaders, including Musk and Huang, are saying the same thing. He believes the market's nervousness about spending creates a buying opportunity.

  “something like the center of gravity of this company is gonna be Muse in a year. Like, I think that speaks to the level of confidence.”at 14:02

Western Digital

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

• Matt Bryson · Wedbush SecuritiesBullish

  Hard drive shortage of over 400 exabytes makes Western Digital's supply constraints durable; outperform.

  Bryson says Western Digital's forecast beat the Whisper number and that the stock is not moving because the market is focused on the whole AI spend, not the company. He cites a shortage of over 400 exabytes of hard drives against what the major clouds are looking for, which is more than 20% of the market. He says there are shortages in memory and hard drives, and the real problem is supply constraints, so constraints will persist even if there are setbacks. The host reported his Wedbush outperform rating with a $650 price target.

  “I think there's over 400 exabytes of shortage in terms of hard drives right now versus what particularly the major clouds are looking for. That's more than 20% of the market.”at 20:26

AI infrastructure & data centers

• Jensen Huang · NVIDIA

  Neocloud demand is off the charts; the constraint is capital, which will get solved.

  Huang argues the bottleneck for neocloud providers such as CoreWeave is working capital, not demand. He says neocloud demand is off the charts and their capabilities are extraordinary. He says there is a scarcity of capital because demand for capital across many AI sectors exceeds its availability, and that this will get solved. He is defending CoreWeave against the market's worry about its financing.

  “The demand for the Neo Clouds is off the charts. Their capabilities are extraordinary... there's a scarcity of capital. The demand of the capital is much greater than the availability of the capital. That's gonna get solved.”at 4:38

• Gene Munster · Deepwater Asset Management

  Hyperscaler capex growth will run well above Street estimates, at 70% or more next year.

  Munster says the Street expects about 38% capex growth next year, but he thinks the real number will probably be 70% or more. For calendar 2028, the Street is at 11% while he expects 25% to 40%. He ties this to Meta's commitment to Muse, Tesla's FSD, and Elon Musk's plan to add 10 gigawatts of compute next year. He thinks the stocks will probably do fine even with spending at that level.

  “next year, the street's looking for 38% growth in CapEx. The real number is gonna be probably 70% or greater.”at 14:39

• Matt Bryson · Wedbush Securities

  Neocloud paybacks under a year mean demand will be financed and built, so capex continues.

  Bryson says he feels better about the environment from talking to smaller neocloud providers, which he calls the variable sellers. Their payback time on data center investment is under one year. If the demand for actual capacity is there, someone will find a way to finance and build it, so semiconductors and hard drives will still be needed. He argues there will be no end to spending soon. He expects builders to work around constraints in funding, power, and siting, including by building outside the US where there are no moratoriums.

  “Their payback time is amazing. It's sub one year on bringing on data center investment. I think if there's that much demand out there for actual capacity, that someone's going to find a way to finance and build it.”at 19:15

• Jeff Rosenberg · BlackRock

  AI capex has outgrown internal cash flow, so public bond markets must now finance it and are repricing its risk.

  Rosenberg says the original AI story was that hyperscalers funded buildouts from internally generated cash flow. The capex build-out has grown so much that it now needs the largest market in the world, the public bond market, to finance it. Because bond markets are transparent, they are starting to price the risks, which is causing indigestion. He argues the amount of financing needed is overwhelming even the largest public bond market.

  “Fast forward a couple of years, and the size of the capital expenditure build out requires the biggest market in the world to finance it, and that's the public bond market. So you're seeing the public bond markets now with its transparency start to price those risks.”at 41:52

US Treasuries & yields

• Jeff Rosenberg · BlackRock

  Yields fell because AI-growth concerns weaken the growth outlook that had pushed yields higher; bond market is rational.

  Rosenberg says the bond market moved on its macro read. Yields had risen on two factors: a stronger real growth outlook, driven by AI investment and consumption through the wealth effect, and higher inflation from oil and distillate prices and their secondary effects. Together these lifted nominal GDP and rates. Today's AI-related selloff reverses the growth part, which reduces the factors that pushed rates up, and also reprices the front end of the curve as market tightening could delay Fed hikes. He calls the bond market rational.

  “The bond market is rational. And now what we're seeing is that if there's a concern around AI and it's maybe not as strong, then the impact is to reduce some of those very factors that led the interest rates to go up.”at 39:36

• Jeff Rosenberg · BlackRock

  Treasuries are a rare hedge against AI concentration risk, so demand overwhelms long-run fiscal worries near term.

  Rosenberg argues AI exposure is everywhere in portfolios, so investors need diversifiers. Last week and today showed there are very few places to hide from the AI theme, and fixed income and Treasuries are one of them. In the short run this demand overwhelms longer-run concerns, including fiscal policy worries that will hit the back end of the curve and the spillover from France, where yields are above 5%. He says those longer-run concerns remain and can resurface.

  “we found out last week, there's very few places to hide away from the AI theme. And one of those places is the fixed income market and treasuries. And so in the short run, that's gonna overwhelm these longer run concerns.”at 41:18

AI: overall outlook

• Gene Munster · Deepwater Asset Management

  AI is still early; the world will be reoriented around it beyond today's high expectations.

  Munster argues that if you believe the leaders are competent, you should conclude AI is still early. He says the change in the last week is personalised bots and agents using 10 to 15 times the token usage of a typical chatbot, plus physical AI. Those two developments are much bigger than anything in the last few years. He sees a massive gap between what companies say about how transformative AI will be and how early it is, and the market's willingness to accept that. He concludes the world will be reoriented around AI in ways that cannot be fully understood, beyond the high expectations held today. He says the stocks are ultimately great buys on this nervousness.

  “the world will be reoriented around AI in ways that we fully can't comprehend that are beyond what I think the high expectations are today.”at 12:39

US stock market outlook

• Nick Colas · DataTrek Research

  S&P concentration in tech is structural, driven by Moore's Law; investors can diversify via RSP.

  Colas says the S&P 500 is now about 50% tech plus big tech, which is more than oil in the 1980s or tech in 2000. He attributes this to roughly 40 years of Moore's Law making semiconductors more powerful for the same dollar, with setbacks such as 2000 and 2002 along the way. He calls it a structural shift that will not change. For investors worried about the concentration, he recommends the equal-weight S&P (RSP), which is about 16% tech and more diffused.

  “We end up with an S and P that's 50% tech plus big tech... We're now at a point where literally Moore's Law has taken over the S and P, and that's not going to change.”at 28:39

US housing

• Nick Colas · DataTrek Research

  Homebuilders have underperformed massively but remain a good sector; mortgage relief would help.

  Colas says homebuilders have been destroyed since 2025 and have massively underperformed. He still calls it a good sector with rational capital allocators. He argues that any relief on mortgage rates would help the group, and says the firm likes it. The falling yields and a bounce in builders on the day support the case that the group is sensitive to rates.

  “Massive underperformance. Still a good sector, rational capital allocators. Any kind of relief on mortgages is gonna help that group, and we definitely like it.”at 30:58

US growth & recession risk

• Jeff Rosenberg · BlackRock

  AI investment and wealth-effect spending account for almost all current US growth.

  Rosenberg argues the real growth outlook has changed because of AI. AI supports growth on both sides: investment spending on buildouts and consumption through the wealth effect from equity gains. He says this is making a very big contribution and that almost all of US growth is coming from what he calls the AI dividend. That dependence is why he sees a change in the growth outlook if AI enthusiasm weakens.

  “that's the support from AI clearly on both sides, investment and consumption through the wealth effect. We're having a very big contribution, almost all of the growth coming from the AI dividend.”at 39:36

Credit markets

• Jeff Rosenberg · BlackRock

  Triple-C spread widening is a small, idiosyncratic repricing driven partly by legacy refinancing, not broad credit contagion.

  Rosenberg says triple-C spreads blowing out reflect a very small sliver of the market. The widening is not new and has been building for some time. It reflects idiosyncratic risks at individual companies and sectors, some tied to AI and technology but much of it legacy refinancing pressure from the end of the low-rate window and the interest rate shock. He treats it as company-specific repricing rather than a macro risk, though he does not rule out broader repricing.

  “It's a very tiny sliver of the market. But is there the potential for, I guess, a broader repricing of credit? ... The second issue on triple c's, that's not a new story. It's been it's been widening for some time.”at 41:52