Pricing power in an age of conflict and technology as palantir soars

Nvidia pushing through a $4 trillion market cap caught a lot of attention, but for anyone watching the shift in capital flows over the last 18 months, it shouldn’t be surprising.

There’s a clear realignment happening as capital is moving toward companies positioned at the intersection of national security, industrial policy, and long-horizon technology infrastructure. Palantir’s performance, alongside Nvidia’s, is starting to reflect that shift more than any narrative coming out of earnings.

Traditional valuation frameworks such as growth vs value, cyclical vs defensive have started to lose signal. What’s replacing them is something closer to strategic utility. Defense budgets are rising under Trump. The U.S. is using tariffs more as tools of policy than of economics. China is restructuring its domestic supply base in response. In that environment, companies enabling autonomy, inference, and real-time data processing are seeing their relevance priced in. That includes firms like Palantir and, obviously, Nvidia, both of which I’ve had exposure to for a while.

What used to be considered politically sensitive sectors - surveillance tech, defense AI, low-orbit infrastructure - are now becoming normalized, even prioritized. You can see it in the valuation compression of legacy industrials versus the premium being placed on firms building dual-use capabilities. I held Palantir through some of its dead money phase, and what’s different now isn’t hype but alignment with where governments are spending and what they’re trying to build.

European and emerging market indices still overweight legacy sectors, but capital is increasingly flowing into companies that are treated less like vendors and more like infrastructure partners. Markets are picking up on that, even if analysts haven’t quite updated their templates. The divergence between backward-weighted indices and forward-aligned firms is becoming harder to ignore.

For investors, this isn’t about betting on the next thematic rotation. It’s about recognizing what’s being reclassified from “tech” to “strategic core.” Portfolios that were built for a deflationary, open-world model will likely continue to lag in a more fragmented, security-first global environment. The real opportunity now lies in owning companies that governments can’t afford to let fail.