From Bloomberg via Yahoo Finance, April 20:
Investors are set to pour more money into defense, energy and technology stocks as the Middle East war forces governments to prioritize security and become more self reliant.
Wall Street has for years rewarded companies at the vanguard of globalization, while many countries neglected critical infrastructure, supply chains and resources. That era is now over, according to investors, who say the Iran conflict is accelerating economic changes prompted by the coronavirus pandemic, Russia’s invasion of Ukraine and America’s trade war.
“I suspect a lot of people are still in denial that the world has changed,” said John Wyn-Evans, head of market analysis at Rathbones Group Plc. “Covid-19 and Russia-Ukraine were wake-up calls, but we seem to have hit the snooze button. The alarm has gone off again now.”
The war has increased demand for the dollar and US assets, but stock pickers are also hunting for companies that will play key roles in the move toward more secure supply chains and benefit from investment in artificial intelligence, green energy and defense. So far in 2026, energy, materials, utilities and industrials are the top-performing sectors in the MSCI World Index....
....MUCH MORE
side note: Although not nearly as dramatic as oil prices, reshoring - ensuring supply and logistics - and thus unwinding the globalization/just-in-time/rich-get-richer experiment of the last twenty-five years is an inexorable and persistent inflationary force.
As noted introducing January 2024's "Profiting From The Change In The Central Bank - Government Relationship":
If you can get on the right side of the really big moves: Rise of the American empire 1900 - 1999, Buying Japan at 2 to 4 times earnings in the 1950's - '60's, Riding the decline in interest rates 1980 - 2022, it makes the rest of this stuff a lot easier.
You don't need to be right on every detail, just on the broad outline stuff; and in simple binary terms: "short this or long this?" All of a sudden you'll be sidestepping problems you weren't even aware of, and getting lucky in ways that can't be planned but in hindsight look inevitable....
