Halftime Report Live at the CAIS Summit 10/13/26

Expeditors International of Washington

• Josh Brown · Ritholtz Wealth ManagementBullish

  Expeditors is breaking out on strong AI-linked freight volumes; Wall Street underestimates the earnings momentum.

  Q2 earnings rose 51%, about 21% above consensus. Air freight revenue jumped 57%, mostly on higher tonnage, which Brown ties to shipping chips and servers to hyperscalers during the AI capex buildout. Tariff complexity also raises customs-brokerage volume and paperwork fees, and tech-related restructuring helped margins. Despite this, 5 of 17 analysts rate it sell or strong sell, and the stock is up about 30% year to date and making new highs. Brown argues the street doesn't believe the drivers will repeat, and the stock trades at about 28 times for a cyclical. He says the stock is building a tight range with a breakout level near $1.96 and sees it continuing higher while it holds above support. Brown owns it through his concentrated momentum strategy.

  “This company had an earnings report in early August that just absolutely blew the street away. Second quarter earnings were up 51%, which was 21% above the consensus.”at 40:33

Johnson Controls International

• Josh Brown · Ritholtz Wealth ManagementBullish

  Johnson Controls is now an AI-linked stock through data center cooling, and its trend has already broken out.

  Brown says Johnson Controls is doing data center cooling, the same kind of story as Expeditors: a company not seen as an AI or tech stock that has since been pulled into the AI trade. He points to a trend that has already broken out and is doing a low-volume retest of the breakout. The case is thin and rests mainly on the AI-linked business mix and technical price action, with no earnings figures cited.

  “They're doing data center cooling. Same type of story. This was not an AI or a tech stock, and then all of a sudden it was. Look at the trend on this bad boy. This one is already broken out”at 42:15

JPMorgan Chase & Co.

Across the shows: 3 speakers in other episodes, 2 bullish and 0 bearish calls, past 30 days

• Joe Terranova · Virtus Investment PartnersBullish

  JPMorgan's resilient quarter supports the stock; Terranova is holding his position despite lighter trading revenue.

  Trading revenue came in lighter than expected, but JPMorgan's equity division was particularly strong, up 49% from last year. Weakness in commodities and currencies was offset by better net interest margin guidance. Terranova says the resiliency reflects position unwinding over the third quarter, which he sees as supporting the stock today. He bought JPMorgan in June, has traded around the position, and is maintaining it.

  “the resiliency you're seeing in both JPMorgan and Goldman Sachs relates to the fact that you saw some position unwinding over the third quarter, and I think that's why the stock is supported today. I purchased JPMorgan back in June.”at 46:10

Meta Platforms

Across the shows: 17 speakers in other episodes, 18 bullish and 6 bearish calls, past 30 days

• Rob Sechan · NewEdge WealthBullish

  Meta is still the cheapest mega-cap with some of the best developments at the business; he loves it.

  Sechan says Meta is still the cheapest of the mega-caps and has some of the best things happening at the business right now. Scott Wapner notes it has been the best-performing mega-cap over the last month and is up nearly 3% that day. The case rests on relative valuation and recent business developments, with few specifics given.

  “And it's still the cheapest, and it's got some of the best things happening at the business right now, so I love that.”at 49:32

AI infrastructure & data centers

• Joe Terranova · Virtus Investment Partners

  Rising cost of capital is already pressuring AI build-out financing, narrowing market leadership further.

  Scott Wapner raised the risk that the cost of capital becomes too punitive to fund hyperscaler AI build-out commitments. Joe says he thinks that point has already been reached and is beginning to show. He links this to market appreciation narrowing further and further into a few trillion-dollar names.

  “I think we're there already. I think you're beginning to see it. I think that's why we're beginning to narrow further and further where the appreciation is in the market, and it's isolated to a very select few names.”at 13:27

• Shannon Saccocia · Neuberger Berman

  AI infrastructure demand remains intact in power and chips; no decline yet in evidence of demand.

  Over the past year, each time investors took money off the table on AI concerns it proved the wrong call, because a new leader emerged and new demand evidence arrived within a month or two. Shannon says there has been no decline in the evidence of demand, and there is still meaningful demand in the power trade and for chips. Her argument is that new demand news keeps raising demand expectations.

  “We haven't seen, Scott, any decline in that evidence of demand. Like, there is still meaningful demand out there, whether it's in the power trade or whether it's for chips.”at 14:23

• Glenn August · Oak Hill Advisors

  AI build-out needs trillions in capital, creating private credit lending opportunity across power, data centers and chips.

  Glenn calls the AI build-out the most extraordinary capex investment of all time, with capital needs in the trillions. He argues the investment-grade and high-yield markets cannot absorb that, since a 20-30% allocation would be too high, so new forms of finance will be needed. He expects spreads to widen as capital is raised, making lending more attractive. Oak Hill is investing across power generation, data center construction and chip financing, including a turbine-backed loan at two-to-one over-collateralisation targeting mid-teens returns.

  “And, clearly, the AI build out is just the most extraordinary CapEx investment of all time. And whether it's 3,000,000,000,000, 5,000,000,000,000, or 10,000,000,000,000, there's a lot of capital that needs to get raised, and there's opportunity across the space.”at 29:02

• Glenn August · Oak Hill Advisors

  Not all pledged data centers will be built given local pushback and capital constraints, though demand is strong.

  Glenn says demand for compute is so great, and expectations for power and data center deployment are so high, that he is not sure all of them will be built. He cites NIMBY opposition to power and data centers in local communities and capital constraints as obstacles. Demand is still strong, so he sees good opportunity in financing the projects that do proceed.

  “I'm not sure they're all gonna get built. And again, we obviously have the NIMBY movement where people don't want power in data centers in their backyards. I think there's capital constraints, but the demand for compute is great.”at 30:37

• Glenn August · Oak Hill Advisors

  Near-term credit risk on data center debt is low; hyperscalers bear it, but longer-term risk sits with OpenAI and Anthropic.

  Responding to Jefferies' note that about $2.3 trillion of backlog across Microsoft, Alphabet, Amazon and Oracle is about half owed by OpenAI and Anthropic, Glenn says there is risk ultimately. Longer term, the risk lies with OpenAI and Anthropic as end users. In the interim, hyperscalers are taking the risk over a five-year time frame, so the risk is much lower. Oak Hill does not underwrite whether a data center exists fifteen years out and instead looks at shorter deals backed by investment-grade companies.

  “I do think there's risk ultimately. Longer term, there's risk with OpenAI and [Anthropic] being the end user. In the interim right now, when you have the hyperscalers and taking their risk over a five year time frame, I think there's much less risk.”at 31:56

US stock market outlook

• Paul Tudor Jones · Tudor Investment Corporation

  2027 looks challenging; the market is two-speed and bifurcated, mirroring 1999 between AI adopters and non-adopters.

  Paul Tudor Jones argues the market today feels like 1999: a two-speed market, perfectly bifurcated between companies adopting AI and those that are not, with the two groups moving in opposite directions, as was the case in 1999. Scott Wapner reports on air that PTJ sees 2027 as a challenging year and will be short the entire year, comparing today to the dot-com boom and eventual bust. The bear case rests on this bifurcation and the historical analogy.

  “It still feels like 1999, a two speed market. You've got it completely perfectly bifurcated in the sense that you have obviously everything that's adopting AI and everything that's not, and they're going in opposite directions.”at 2:33

• Shannon Saccocia · Neuberger Berman

  Index highs mask weak breadth: 39% of S&P 500 stocks sit 20%+ below highs, and the Russell 2000 is worse.

  Shannon cites S&P 500 all-time highs while 39% of its constituents are 20% or more below their all-time highs, and 56% of the Russell 2000 is similarly far off its highs. She links this to open questions about the next phase of AI adoption colliding with rate sensitivity, and to money rotating out of the broadening trade because of interest-rate and energy-price sensitivity.

  “Right now, you see all time highs being hit in the S and P 500, for instance. And yet when you look below the surface, Scott, 39% of the S and P 500 is below... It's 20% below its all time high mark.”at 3:10

• Josh Brown · Ritholtz Wealth Management

  Narrow leadership has usually resolved with laggards catching up rather than a correction; not guaranteed this time.

  Josh says that over the past 17 years, when a group of leadership stocks pushes the index higher amid weak internals and talk that a few companies hold it up, the rest of the market usually caught up if the index avoided a correction, once a catalyst changed. Possible catalysts include calm in the Middle East, lower oil, inflation expectations held in check, a dovish Fed speaker, or something overseas. He notes that Goldman, Citi and JPMorgan see nothing in consumer data signalling the end of the trend, so the conclusion that it must end is not certain.

  “eventually, if the market is able to hold up and avoid a correction despite the crumbling internals, all of a sudden and the catalyst changes, the rest of the marketplace catch up. We have seen this time and time again. I'm not saying it's guaranteed to go that way this time.”at 9:26

• Joe Terranova · Virtus Investment Partners

  Trillion-dollar tech firms keep the market resilient despite rising yields; narrow but no rollover yet.

  Joe argues technology is effectively the economy, and its robust earnings are pushing against headwinds of higher oil and higher yields, producing resilience. Trillion-dollar companies such as Apple, Meta and Microsoft are not focused on yields rising, so the broadening trade does not come into play through the rest of 2026 into 2027. The market is unhealthy but resilient, and a correction would require taking down those trillion-dollar names.

  “They're pushing against each other, and the result of that is this resiliency that you see in the market. And, Scott, I think the resiliency that you see in the market is fully represented by the fact that these trillion dollar companies are not so much focused on the fact that yields continue to rise.”at 12:17

Banks

• Shannon Saccocia · Neuberger Berman

  Large banks' net interest income read-through is good for regionals, which depend less on trading revenue.

  Saccocia cites combined net interest income of about $56.5 billion at JPMorgan, Citi and Wells Fargo. She says rising rates make this matter, but the more important point is the read-through to regional banks. Regionals are less dependent on trading revenue than the big banks, so the strong net interest income results are a positive signal for them.

  “That's a good read through for regionals because they're not as beholden to the trading revenue as the big banks are.”at 46:45

• Rob Sechan · NewEdge Wealth

  Bank earnings season was solid, with okay loan demand, flat margins and few credit issues.

  Sechan describes loan demand as okay, net interest margin as roughly flat, and few credit issues, and calls it a pretty solid season for banks. He adds that capital-markets-sensitive banks depend on whether capital markets activity picks up, since some banks, including JPMorgan's fixed income division, were hurt by rate surprises.

  “I think loan demand was okay, and NIM was kinda flat. Not a lot of credit issues. I think it was pretty solid season for the banks”at 46:53

• Josh Brown · Ritholtz Wealth Management

  Financial companies' fundamentals are as solid as last quarter; no real deterioration in credit or labor data.

  Brown says financial companies reported results that look as solid as the prior quarter, even though many people expect a deterioration story. He argues the deterioration isn't in the data: not in the labor market and not in companies' credit metrics. He presents this as evidence against the bearish narrative about financials.

  “they basically said everything looks as solid as it did last quarter even though people wanna hear some deterioration story. It's not in the data. It's not in the labor market. It's not in the company's credit metrics.”at 49:13

Private credit

• Shannon Saccocia · Neuberger Berman

  Lending quality improved after the February reset, so private credit is probably a good time to invest.

  Before the February software selloff, private credit spreads were very tight, covenants were light, and a lot of debt went to companies without the growth profile to justify the risk. Since that reset, Shannon argues the quality of the underlying lending universe has shifted for the better, so this is probably a good time for private credit. She adds that since everything is now AI-adjacent, investors need to think about diversifying, for example into high yield.

  “But one could argue that since the reset in February, you're actually seeing sort of a new paradigm or shift in terms of the quality of that underlying lending universe. And the likelihood is that this is a... This is probably a good time for private credit.”at 19:55

• Glenn August · Oak Hill Advisors

  Private credit is doing fine despite last year's redemption headlines.

  Glenn argues the private credit market, despite all the talk of redemptions last year, is doing just fine. He supports this with the credit market's structure: about 70% of the loan market is held by CLOs that do not mark to market, and banks have syndicated their loans out. With a good economy and healthy capital markets, he sees no sign of an imminent recession.

  “The private credit neck... Market for all the talk of redemptions last year is actually doing just fine.”at 33:01

Credit markets

• Glenn August · Oak Hill Advisors

  Credit markets are healthy: stress sits near multi-decade lows and there is no sign of imminent recession.

  Glenn says about 5% of the high-yield market and about 9% of the bank loan market are trading at stress levels. The high-yield stress level is at a very low level, around twenty-year lows, and the loan figure is in line with its history once the 4% of software is stripped out. He argues the economy is good and capital markets are in much better shape: banks have syndicated out loans, 70% of the loan market is held by CLOs without mark-to-market, and 60% of high yield is double-B. Stress is idiosyncratic, in secular decliners, over-levered companies and sectors like building products.

  “about 5% of the high yield market is trading at stress levels. In the bank loan market, it's about 9%. The 5% is at a very low level. It's kind of at the twenty year lows.”at 33:20

• Glenn August · Oak Hill Advisors

  About 10% of credits are distressed, with $150B of triple-C debt maturing, creating a stress-side opportunity.

  Glenn says the market is bifurcated: about 90% trades at healthy levels while about 10% trades at triple-C below 80 or at distressed levels. That 10% includes $150 billion of triple-C debt coming due over the next few years, which creates a real opportunity on the stress and capital-solutions side. In software there is dispersion rather than bifurcation: about 75% of software loans trade above 90 and 20% below 80, so the question is which of the weaker names will survive. Picking credit well is how Oak Hill makes its returns.

  “So you have 90% of the market trading at very healthy levels, and you have 10% trading at triple c below 80 or distressed levels. That 10%, $150,000,000,000 of triple c debt coming due over the next few years, There's a real opportunity there, Scott, on the stress side, on the capital solutions side.”at 35:02

AI bubble & tech valuations

• Rob Sechan · NewEdge Wealth

  AI stock concentration reflects real earnings and visibility; the main risk is financing, possibly a 2027 problem.

  Rob argues the market's concentration in AI names is simply where earnings growth, earnings revisions, contracted revenue and visibility sit, and valuations have improved. The mag seven and chips together make up about 44-45% of the market, so any wobble would hit energy and consumers through the wealth effect. The key risk is the ability to finance the build-out; he says that capital is available today and is not the problem now, but Paul Tudor Jones may be right that it becomes next year's problem. He says the trade is not over and AI remains his highest-conviction space.

  “I think it's the way things are for obvious reasons, actually, because that is where the earnings growth and earnings revisions have been. That's where the contracted revenue is. That's where visibility is.”at 5:22

Market sentiment, positioning & volatility

• Rob Sechan · NewEdge Wealth

  Retail speculation is heavy with short-dated call buying, while institutions remain cautious.

  Rob sees an underlying level of caution among institutions but a lot of YOLO behaviour among individuals. Individuals are buying short-term call options, buying upside while understanding their exposure. Scott Wapner reports that daily single-stock options volume has recently reached about $700 billion, near 2021 meme-stock levels.

  “I think there's an underlying level of caution on the institutional side. I'm gonna say that the individual side, there's a lot of YOLO out there. These short term options, all on the call side, buying upside while understanding your exposure.”at 15:50

US Treasuries & yields

• Rob Sechan · NewEdge Wealth

  Bonds are now a cheap shock absorber after yields rerated to a two-standard-deviation move.

  Rob says BlackRock's shift to bonds was not about equity exhaustion. Forward equity returns may come in somewhat, while the bond market has rerated to a two-standard-deviation event, giving investors a shock absorber they can buy at a reasonable valuation if something unwinds. Bonds were ignored for a long time and are now getting picked, and collecting the coupon could work without any calamity.

  “It's not equity exhaustion. It's that that forward returns may come in a little bit, but the bond market has rerated to a two standard deviation event. And now you have a shock absorber that you can go buy at a reasonable valuation in the event something unwinds.”at 17:23

Private markets for individual investors

• Rob Sechan · NewEdge Wealth

  Private markets allocations lag targets (14-15% vs 20-30%) as headline risk scares investors.

  Rob's firm is an active allocator to private markets, but acceptance has been limited because investors have been scared off by headline risk in the space. Target allocations are 20-30%, but across the firm's roughly $120 billion in assets the actual implemented allocation is closer to 14-15%. He suggests the individual side is more affected by the noise than institutions.

  “We're active allocators to that, but there's not been broad acceptance because investors have been scared off by what I think is a lot of headline risk in the space. So if you look at our target allocations, they're 20 to 30%.”at 21:03

Private equity

• Rob Sechan · NewEdge Wealth

  Large PE has more capital than opportunity; small PE funds have more deals and higher forward returns.

  Rob argues large private equity has more capital than ever and perhaps less opportunity, while small PE funds have less capital and many more opportunities, so forward returns should be higher there. He also sees secondaries as an opening because large funds have returned limited capital for several years, and institutions need that liquidity to fund endowment draws. He says private markets should not be lumped together, since there are great categories and weaker ones.

  “Large PE has more capital than ever and less opportunity than ever, maybe. Small p, small PE funds have less capital and tons more opportunities. So the return... Forward returns should be higher there.”at 22:09

US rates & the Fed

• Glenn August · Oak Hill Advisors

  Short-rate expectations rose about 200bp to five percent; the economy can handle it, creating yield opportunities.

  Glenn says short-term rate expectations have moved about 200 basis points, as people went from expecting rates to reach three percent to now expecting five percent. He argues the economy can absorb that because there is less leverage in the system, so the impact is smaller. For investors locking in yields, a five percent five-year yield plus about 300bp spread in high yield, 400bp in loans and 500bp in private credit, with some leverage and a complexity premium, can make high single-digit to low double-digit returns.

  “There's no doubt that as we've moved up from... And, in fact, the short term expectations have really moved 200 basis points because people thought we're going to three, and now people think we're going to five. The economy can handle that.”at 34:16