Market Recap – Tuesday, December 9th
A shorter update today as I am traveling to Norway, but several developments across Asia and global defense are important for our thesis.
Tensions in the Indo-Pacific continue to rise. Over the weekend, a Chinese aircraft carrier group launched an unusually intense round of air operations near Japan, conducting roughly 100 take offs and landings as it moved east past the Okinawa Islands. Japan’s Self Defense Forces also reported that Chinese fighter jets twice aimed their fire control radar at Japanese aircraft. This is an escalation that signals a potential attack and forces evasive action. These are the types of incidents that raise geopolitical temperature and reinforce the trend we invest in: ongoing military build ups by the United States, Japan, and Taiwan.
In Washington, United States Congress leaders approved a defense package that includes 800 million dollars in Ukraine assistance across 2026 and 2027, along with a requirement to review Russia’s military strategy and how it affects the Indo Pacific. Congress has also rolled out a 901 billion dollar defense bill for fiscal year 2026, which is 8 billion dollars above President Trump’s request. It is one of the most hawkish and China focused defense bills in years. It tightens outbound investment screening into China, bans Chinese biotech and key technologies from Pentagon supply chains, increases funding for Taiwan and the Indo Pacific posture, expands Ukraine support, and includes a 4 percent pay raise for enlisted troops. The bill also creates a new AI Futures Steering Committee. Importantly, it repeals the 1991 and 2002 Iraq war authorizations but keeps the 2001 post 9/11 authorization in place, maintaining operational flexibility. ( $ITA (iShares US Aerospace & Defense ETF)
)
$TDY (Teledyne Technologies Incorporated) FLIR, which is not one of our holdings, received a 42.5 million dollar contract from the United States Marine Corps for the Rogue One loitering munition. Although we do not own the stock, this contract is relevant because it demonstrates the rapidly accelerating demand for attritable drones and loitering munitions. This directly supports the ecosystem of companies that we hold, especially in areas like sensors, thermal imaging, and autonomy.
A noteworthy update also came from $RKLB (Rocket Lab Corp) . The company has begun transporting major Neutron components to the launch site. Over the last few days, parts were moved toward port departure, and during the weekend the structure known as “Hungry Hippo” was seen in New Zealand waters heading toward the Panama Canal. The transit will take 33 days, and arrival is expected around January tenth. The vessel is currently in the South Pacific Ocean. It is a new cargo ship built in 2025 and sailing under Dutch supervision. This is one of the clearest physical signals so far that Neutron is moving into its assembly and integration phase, a key milestone heading into 2026.
I will provide a broader update once I land, but the geopolitical environment, the United States defense budgeting trend, and the operational progress of our core positions all remain aligned with our long term thesis.
Thank you and see you when the Market Opens! ... Show More
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Sun Jan 25 2026 06:48:27 GMT+0000 (Coordinated Universal Time)
