Halftime Report Navigating the Pullback in Software 2/4/26
Feb 4, 2026
Jenny Harrington, an investment committee member focused on health care and software stock research. Liz Thomas, a market strategist known for sector calls on materials and emerging markets. Joe Terranova, market strategist offering macro and trade ideas. They debate software sell-offs and AI fatigue. They weigh ETFs versus stock picking, chip cycle reactions, cloud capex ahead of big tech earnings, and rotations into materials, energy, and health care.
AI Snips
Chapters
Transcript
Episode notes
Momentum Rotating Into Quality
- The market is rotating from momentum into quality, hurting 2025 leaders like software names.
- A quality overlay can act as a shock absorber during momentum-driven sell-offs.
Don't Panic-Sell Software Declines
- Avoid panic-selling during broad, sentiment-driven software declines and consider staged entries.
- Use ETFs for broad exposure once bottoming appears, but expect a drawn-out bottoming process with more volatility.
Research Stocks Now, Don't Rush Buys
- Start researching individual software names now rather than buying indiscriminately, because winners and losers will diverge.
- Focus on valuation and margin of safety; many names still trade at extremely high multiples despite compression.