A Goldman Sachs executive revealed that private markets clients are relieved the Iran conflict provides a distraction from mounting concerns over software exposure. Kunal Shah, co-chief executive of Goldman Sachs International, told clients that some private markets investors are 'just glad there's something to talk about that isn't software exposures and private credit.'

Private equity and credit firms have faced steep declines this year as AI threatens to disrupt software companies. Blue Owl Capital, a tech-focused lender, has seen shares fall nearly 40% after restricting cash withdrawals from its private retail debt fund. Major firms like Blackstone and Apollo Global Management have shifted toward corporate lending, exposing them to broader market jitters about underwriting standards.

The banking sector remains on edge following the September bankruptcies of Tricolor Holdings and First Brands Group, which sparked warnings from JPMorgan Chase CEO Jamie Dimon about potential 'cockroaches' in credit markets. The Iran conflict has created volatility that some investors view as welcome relief from scrutiny of their software-heavy portfolios.