Oil Dips as Market Watches Middle East & Energy and Defense with ETFs

Summary

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Brew Markets – March 23, 2026

Episode: Oil Dips as Market Watches Middle East & Energy and Defense with ETFs
Host: Ann Berry
Guest: Shauna Smith (Senior Investment Strategist, Global X)
Key Contributors: Devin Emery, John Curto

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Episode Overview

On this episode of Brew Markets, Ann Berry and the team dig into today's biggest market movers: the sharp drop in oil prices amid Middle East tensions, the state of global energy assets, and how investors are navigating defense and energy sectors—particularly through ETFs. Shauna Smith of Global X joins to offer insight on ETF strategies for energy, defense, and diversification as geopolitical uncertainty remains high.

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Main Discussion Highlights

Oil Prices & The Middle East Crisis

• IEA Reports Energy Infrastructure Damage:

  • Over 40 energy assets across 9 Middle Eastern countries have been “severely or very severely damaged”—now considered a crisis on par with the oil shocks of the 1970s and the 2022 natural gas crunch.
  • “Current disruptions are the equivalent to the two major oil crises of the 1970s plus the 2022 natural gas crisis.” (Ann Berry, 02:05)

• White House Announcement Calms Oil Prices:

  • President Trump’s halt on U.S. strikes against Iranian energy infrastructure for five days sent Brent crude tumbling 7% to below $104/barrel—down from $112 on Friday.
  • “The Dow jumping 800 points today, signaling hope.” (Ann Berry, 03:38)
  • Iranian state media claims safe passage through the Strait of Hormuz will remain open for most, but not to “Iran’s enemies.”

• Broader Supply Chain Impacts:

  • Not just oil—fertilizer, sulfur, and helium supplies also disrupted, leading to protectionist moves from countries like China (e.g., restricting fertilizer exports).

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Geopolitics & Investment Diversification (with Shauna Smith, 05:50+)

Why Shauna Joined Global X

• Shauna shares her career leap from journalism to portfolio strategy at Global X:
  • “I thought, hey, I'm going to give it a shot... and hope that I'm able to find my way.” (Shauna Smith, 06:18)

Tackling Listener Questions

• US vs International Diversification:

  • There’s logic in both “buy America” and diversifying internationally, especially now.
  • “We do see opportunity... But International EM is very attractive about the fact that it is under-owned right now.” (Shauna Smith, 08:06)
  • Importance of balance: “[International EM] offers you very much that... You don't want to be over concentrated in one area versus another.” (Shauna Smith, 08:34)
  • Geopolitical uncertainty, U.S. policy unknowns, and a softening dollar further support the diversification case.

• US Dollar & International Investments:

  • A weaker dollar generally makes overseas investments more attractive, benefits trade, and offers indirect international exposure through U.S. multinationals.
  • “[A soft dollar] makes it more attractive for companies outside of the U.S... another way to play almost an international exposure or further diversify your portfolio.” (Shauna Smith, 10:36)

• Europe/Asia vs. Emerging Markets (EM):

  • Europe: Stronger developed market, somewhat safer, but growth outlook still “constructive.”
  • Asia: Despite weaker consumer trends in China, upper-end spending remains, offering selective opportunity.
  • Quote: “Within Europe... the growth trajectory there... is a little bit of a safer bet in terms of developed markets versus EM.” (Shauna Smith, 12:38)

What Counts as Emerging Market in 2026?

• The EM “basics” (BRICS: Brazil, Russia, India, China) still offer opportunity, as do Southeast Asia and Argentina.
  • “It kind of reminded me of the BRICS acronym... so it's still Brazil. You still have the Southeast Asia exposure as well... you have India.” (Shauna Smith, 14:10)
• China: Domestic players are winning (e.g., Luckin Coffee), but Western brands (e.g., Nike, Starbucks) face pressures.
  • “The domestic players are taking market share... that's been very much the case almost across the board.” (Shauna Smith, 15:33)
  • Still, the sheer scale, rise of the middle class, and long-term growth potential justify maintaining some China exposure.

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Sector Focus: Energy via ETFs (17:02+)

Three ETF Buckets for Energy Investors

• Upstream (Production/Exploration):

  • More exposed to commodity price swings—if you think oil will stay high, this is your play.
  • “If you're of the belief that we are going to see prices rise to the moon... you might want to bet on some of those upstreamers.” (Shauna Smith, 19:42)

• Midstream (Transport/Infrastructure):

  • Less tied to oil’s price, more about volume—pipelines, LNG.
  • Likely “sweet spot” if oil stabilizes around $70–75/barrel.
  • “Not a lot of people talk about midstream and MLP.” (Devin Emery, 20:45)

• MLPs (Master Limited Partnerships):

  • Favored for income generation; energy MLP ETFs provide direct sector exposure and yield.
  • Only about 3% of the S&P 500 is energy, so broad-market ETFs don’t give much sector exposure.

Overall Strategy

• Investors should diversify within energy: consider your price outlook, need for income, and risk.
  • “It is important... make sure what you own makes sense.” (Shauna Smith, 19:28)

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Defense Tech: ETF Approaches & Outlook (21:16+)

The Defense ETF Solution

• Global X's SHIELD ETF:

  • A blend of legacy (Lockheed Martin) and tech-oriented (Palantir) defense stocks.
    • “SHIELD has seen a tremendous outperformance... in between 60 to 70%.” (Shauna Smith, 21:28)

• Sector Resilience & The Long View:

  • Despite geopolitical instability, some defense stocks haven’t shot up as much as expected—offering value.
  • “We still think there’s a tremendous amount of growth within this sector.” (Shauna Smith, 21:36)
  • “When you pair it together in a name like SHIELD, it is almost a perfect way to get that exposure to the growth and to the spending that we continue... for years to come.” (Shauna Smith, 23:21)

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Notable Quotes & Memorable Moments

• “The market is waiting with bated breath to see if the five day long pause [in U.S.-Iran tensions] holds and if it yields longer term peace.”
  — Ann Berry, 03:25

• “You don't want to be over concentrated in one area versus another. And I think right now... it is so important to remain diversified, especially at a time like this.”
  — Shauna Smith, 08:32

• “Starbucks, they've been talking about this now for years and years... it’s a tough problem to solve... At the same time, you need to have exposure to China.”
  — Shauna Smith, 15:53

• “Not a lot of people talk about midstream and mlp. So really appreciate you bringing that up.”
  — Devin Emery, 20:45

• “For the record, I think value is very glamorous and exciting. I love boring. A boring value.”
  — Devin Emery, 23:37

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Rapid-Fire News Roundup (24:57+)

• Markets Surge:
  • S&P 500 up 1.15%, NASDAQ and Dow up 1.38%; VIX (fear index) down.
• Elliott Management’s New Stakes:
  • Activist investor expands into Synopsys (SNPS), shares up 4% on hopes for AI-related growth.
• BTS Comeback Flop Affects Hybe:
  • After a long-awaited return, BTS’s Seoul concert draws a smaller-than-expected crowd; Hybe shares fall 15%.
  • “BTS once accounted for about 95% of the company's revenue, falling over time to about 20% as Hybe diversified…” (Ann Berry, 27:30)

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Key Timestamps

• 02:05 – Middle East energy crisis details
• 03:25 – White House/Iran de-escalation impacts
• 05:50 – Shauna Smith interview begins
• 08:32 – US vs International diversification
• 10:36 – US dollar and international exposure
• 12:38 – International developed markets outlook
• 15:33 – China market & domestic competition
• 17:02 – ETF strategies for energy sector
• 19:42 – When to buy into energy: upstream, midstream, MLPs
• 21:16 – Defense tech and SHIELD ETF
• 24:57 – Market closing numbers and headlines
• 27:30 – Hybe and BTS comeback disappointment

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Summary Takeaways

• Oil volatility remains tied to Middle East politics; optimism in markets follows de-escalation.
• Diversification is critical: US equities have drivers, but international/emerging markets offer balance—especially with a softer dollar.
• Energy ETFs can help investors target specific themes: upstream (risk/price volatile), midstream (pipeline, infrastructure stability), or MLPs (income).
• Defense sector: Modern ETFs like SHIELD blend traditional and tech-driven companies; sector still seen as underappreciated by the market.
• Stock stories: Synopsys and Hybe highlight how AI and entertainment swings are moving investor sentiment.

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Listeners leave with actionable frameworks for portfolio diversification and sector exposure, as Shauna Smith’s guidance underscores the importance of understanding both macro and micro forces shaping today’s investing landscape.

Transcript

[Ann Berry]

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[Shauna Smith]

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[John Curto]

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[Shauna Smith]

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[Ann Berry]

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[Devin Emery]

Now or never. That's buying energy, ETFs, international stocks is this the time to go in or in fact the time to buy America? Lots of questions including from our listeners. And so we welcome Shauna Smith, senior investment strategist at Global X to break it all down. K Pop superstars bts, they are back on stage and after nearly four years away, surely that's music to followers ears. Well, we take a look at the shares of Hybe listed on the Cosby to find out what investors think and the latest developments in the Middle East. We survey the market's reaction for Monday, March 23rd. It's blue markets Daily and I'm Ann Berry. More market details to come. But first, clarity is starting to emerge on the damage done to energy assets in in the Middle east and what this may mean for supply chain disruption in coming weeks and months. The International Energy Agency's executive director, Fatih Birol said last night that more than 40 energy assets across nine countries have been severely or very severely damaged and that current disruptions are the equivalent to the two major oil crises of the 1970s plus the 2022 natural gas crisis. That was after Russia invaded Ukraine, quote all of those put together, highlighting the fact that even if pe soon, disruptions to global supply chains are likely to remain for some time. That's as oil fields, refineries and pipelines slowly, slowly come back online. Well, as a reminder, the IEA announced earlier this month that it would release a record 400 million barrels from emergency oil reserves to help ease these supply shocks and contain price spikes. But it's not only oil and gas supplies that have been impacted, most notably hitting exports to Asia. We've seen fertilizers, sulfur, helium, all important production inputs have seen their flows interrupted too, prompting protectionist reactions in some cases, with China, for example, clamping down on fertilizer exports to keep prices low for its domestic farmers. So today the market welcomed news from the White House that sent oil prices down. In the trading session, President Trump said the US And Iran have had productive talks and that he has ordered a halt on the US Strikes against key Iranian energy infrastructure that pause for a period of five days. Well, this comes after the President took a different position on Saturday when he gave Iran a 48 hour deadline to reopen the Strait of Hormuz, through which 20% of total global petroleum liquids previously flowed daily. Well, in response to today's announcement, Brent crude fell more than 7% to under $104 a barrel. That's after shooting past 112 on Friday. Goldman Sachs today. It also just sharply raised its oil price forecast for March and April to $110 on average, a 62% jump from the 202025 annual average. So the market is waiting with bated breath to see if the five day long pause holds and if it yields longer term peace. The Dow jumping 800 points today, signaling hope. Yet just to point out, Iranian state media yesterday insisted that safe passage through the strait would be allowed for all shipping except for vessels linked to Iran's enemies. So it's a dynamic situation here and one that we will keep watching very closely and the impact of which we discuss with our guest who's coming right up. That's Shana Smith, senior investment strategist at Global X. But first, a word from our presenting sponsor, CME Group. No matter what the market is doing, managing risk and finding new opportunities is always top of mind. And that's where CME Group comes in.

[John Curto]

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[Devin Emery]

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[John Curto]

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[Devin Emery]

of emails, comments and requests for coverage from listeners. And one of our favorite things, absolute favorite things to do on this show is find the right expert to join us to share their perspectives on topics that are top of your mind. While with commodity prices fluctuating in response to the blockade of the Strait of Hormuz, many have asked, is this the time to buy into energy stocks or has the moment passed? Others have posed the question, is geopolitical turmoil the time to diversify out of US Stocks or come back on in? Well, to break it all down, we welcome Shauna Smith, senior investment strategist at Global X, a New York based provider of exchange traded Funds and with over $60 billion in assets management. So a lot of knowledge here. Let's get into it. So excited. We have Shawna Smith at Global ETFs. And Shauna, I'm thrilled because I have been on the other side of this with you for years. Shauna, you are a brilliant anchor at Yahoo. Finance and you decided to make the move into going to the money, right? You literally followed the money. To start off, before we get into the, into the really deep stuff. Why did you decide to do that and how's it going?

[Shauna Smith]

You know, and it was, it was a bit scary. Still is at some point. I've been there for about seven or eight months now. So I feel like I finally have my feet under me. And to be honest, it was very organic. I was presented with an opportunity. I saw Global X as a real attractive place that I could potentially really carve my way. And we talk a lot about. I spent years and years and years of reporting on the biggest stories and what in my view, the smartest people on Wall street think and why they think that. And I absolutely loved that side of the business. And I got to a point with this opportunity presenting itself with a firm like Global X, the growth trajectory that it has been on, the fact that it's ETF issuer at a time when ETFs are becoming more and more popular, I mean, you just take a look at the flows that we have seen within that space over the last couple of years and you know what? I thought, hey, I'm going to give it a shot. I'm going to give it a go and try my best and stick my head out there and neck out there and just hope that I'm able to find my way. So seven or eight months, I can't say I've certainly found my way. But we're getting more and more comfortable every day. And it's been so different, I have to say, being on the other side of the desk and a little bit more intimidating than I thought it was.

[Devin Emery]

No way. So she's. So Sean has gone from interviewing the smartest minds on Wall street to now being interviewed as one of them. Because I keep seeing you popping up everywhere. So delighted to have you. And let me just give you some context why specifically we thought you'd be perfect. Today we get tons of audience engagement. People write to us by email. They send us comments, whether it's on the audio platforms or whether it's on YouTube. And we keep getting two recurring questions. And again, these are folks who are looking to ETFs as a way solve for gaps in these two specific areas. And the first one is with respect to geopolitics. And what does that mean for investing in the United States? Because there's one school to thought that we hear about which is overseas internationals looking a bit cheaper. Now's the time to diversify. There's another that says no, no, this is the time for flight to safety. And at the end of the day the United States historically has been it. So where do you land on that balance?

[Shauna Smith]

You know, I think there is a place for both of those arguments to hold true. And that's very much what we believe at Global X. And I think there's a reason to believe and a long, long list of why you should be bullish on US equities. Right now we very much are firmly in the camp that we do see a lot of opportunity, obviously some of that being driven by AI and the investment opportunity there. But obviously we talk about the diversification story and what we've seen in terms of broader participation at least in the start of the year to see that come to fruition a little bit. So we certainly do see opportunity here in the. With that said, International M is very attractive about the fact that it is under owned right now. You talk about the fact that attractive valuations compared to some of the investment opportunities I was just laying out within the US So there is place for both. And I think that also offers you a little bit of balance, right? You don't want to be over concentrated in one area versus another. And I think right now as you talk about the fact that there's a lot of uncertainty happening in the US when it comes to policy, when it comes to geopolitics, when it comes to some of those driving factors, exactly what that leadership is going to look like in the makeup. It is so important to remain diversified, especially at a time like this. So International M offers you very much that. And I think about it and think about the fact that you have a softening dollar, just a bait that obviously makes it international a bit more attractive. You have multinational companies, you can make the argument you can get some of that exposure within us there. But we think there is at least a portion of your portfolio that does make sense to have an international EM exposure now. You need to be smart about it. We talk about the fact that it's obviously a very much a global world when it comes to the economics. You have various drivers that are driving certain parts of the areas of the world versus others. So you get exposure beyond the Fed to other central banks, to other policies. And it makes it a more complete picture in terms of the investment story and where you could see pockets of opportunity outside the U.S. so you've said

[Devin Emery]

almost three things in there and I'd love to break them down individually. Thing number one was where the US dollar is now. Thing number two is international, which can mean both emerged or advanced economies like Europe. And you've said thing number three, which is em, which for those listening means emerging markets. So let's unpack those three, if you don't mind. Let's start with the dollar. So the weaker dollar you've said is the tailwind for international equities. Let's say if we just don't mind, let's go step by step. A weaker dollar means buying foreign currency denominated assets is more expensive right now. So why, despite the fact that they're more expensive because the dollar is weaker, is this the time to go buy them?

[Shauna Smith]

Because they can be bullish for trade. And I think right now I bring that up with an anecdote of there's a lot of uncertainty and I think a lot of people listening to this would say, hey, trade is actually the thing that can throw wrench in some of the story and in some of the tailwinds that we are expecting to see. But it does make it cheaper for companies outside the US And I think for so long when we talked about the fact that we had the stronger dollar bringing the US the multinational companies were citing that as a headwind. Right. It makes it tougher for them to do business. So there is with the softer dollar, it makes it more attractive for companies outside of the U.S. obviously in terms of an investment opportunity for the U.S. your, your dollar does still go a decent way. But even with the multinational companies here in the US who have significant exposure overseas, that is another way to play almost an international exposure or further diversify your portfolio. If you're not comfortable taking that, you do have that opportunity to go more than multinational company exposure route. And then of course you can make the argument that it could be obviously on a case by case basis, but a little bit safer because you have the US exposure as well.

[Devin Emery]

Got it. So then let's go international. So let's say you want to go go the whole hog, right? And you're willing to go and buy international assets. Let's leave emerging markets to one side. Talk to me about Europe and Asia and the kinds of ETFs that you've been seeing that perhaps Allow folks to participate in exposure in those kinds of markets.

[Shauna Smith]

Yeah, so we're actually heavily at Global X is more so geared a little bit towards the EM space and where we are seeing opportunity there. I think more broadly speaking when you take a look at the consumer right now, two different arguments are going on right. When it comes to China a long time we have seen this wave, we have seen this trend of a bit of a weakening consumer. But when you take a look at the growth expectations relative to what they were and the fact that we are still seeing consumer spend, especially on that upper end, that can be bullish for international, specifically for Asia, there is still a lot to like within that area. Within Europe I think there is some uncertainty when it comes to the ECB what we are going to see rate policy wise, what exactly that looks like the growth trajectory there. It is a little bit of a safer bet in terms of developed markets versus em. Right. So if you were allocating more of your portfolio to em, you're going to have a much higher risk tolerance. So I think that's important to, for investors to factor in as they're trying to figure out what exactly makes sense within their portfolio. If you have em, you want to make that very, you want to make sure that you have a very, very balanced in terms of the other side which is a little bit more of a safer play. International, not as risky for a number of reasons. I think many of them are relatively obvious. But we do see an opportunity and we do think that the growth numbers outside of the US International, specifically Europe are still attractive and we do are still seeing reason to remain optimistic and remain constructive on the region.

[Devin Emery]

And how do you define emerging market now? Because that's something you go back 10 years. Right. The definition of emerging market then is probably not what it would be today. So which countries are we talking about?

[Shauna Smith]

You know it is so interesting. I mean you take a look at some of the driving factors within EM right now and our, our PM head who's head of active strategy at Global X and leads the commodities and exposures there highlighted a couple of factors that are going on right now that to him reminds him of the 2001 through 20092010 period where we and outperformance of em. Right. So at least for right now he is seeing opportunity within what he calls going back to the basics. So it kind of reminded me of the BRICS acronym that that is exactly

[Devin Emery]

Brazil, Russia, India and China just to clap.

[Shauna Smith]

Exactly. So he's seeing more opportunity within basics. So it's still Brazil. You still have the Southeast Asia exposure as well. Within there you have Argentina. That's the A S is southeastern exposure. You have India. Lots of reason to remain optimistic. We did see some progress on the trade deal with the Trump administration. Obviously, tariffs do remain a bit of a concern there. And then you also have opportunity outside of that as well. When it comes to China. And I bring up China just because of the fact that we are starting to see the consumers there gain a little bit of confidence. More and more confidence. I would say we are still seeing spending on the upper end. Obviously, it's not a complete picture or it's not a consistent picture that we can say for the economy as a whole. As a whole, it rarely is. But we are still seeing spending there. We are still seeing reasons to be constructive.

[Devin Emery]

Let me just ask you some more about China, because when you listen to the multinationals here in the US let's take Nike or Starbucks, they would say they've really struggled in China. And one dynamic that's been interesting has been the rise of domestic Chinese companies, whether it's Luckin Coffee or whether it's domestic Athleisure athletic apparel businesses. So the ETFs you're talking about, given what you're seeing, is glimmers of hope with the Chinese consumer. They're exposed to those.

[Shauna Smith]

There is, there is, there is glimmers of hope. And it varies across sectors. I think it is. And you bring up a great point when it comes to China, the investment story is changing a bit when it comes to who exactly is winning there and the domestic players are taking market share. And that has been very much the case almost across the board. Now, we have heard mixed messages when it comes to the luxury sector. And exactly what we're seeing there, what that demand looks like, looks like. But when it comes to a name like Starbucks, they've been talking about this now for years and years. And it's a very, it's a tough problem to solve. And I don't think anyone really has that Magic 8 ball. And exactly what this is going to look like. At the same time, you need to have exposure to China. I think it's a very, very strong argument to make that you still need to have representation there. Just given the population, given the growth factor, given what we are seeing from the rise of potentially of the middle class there and what exactly that wealth is going to look like. So you need exposure. You need to be able to balance that with some of the domestic companies that are gaining more and more Traction and that is going to be a problem that's not going away. Right. So many of these companies, when you bring up a name like Starbucks, you bring up a name like Nike, that is a problem they are going to be trying to solve. And I don't have the answer for it, but they are going to be trying to solve now for years and years.

[Devin Emery]

To go back to your point on diversification, right. And getting that balance, let's, let's shift gears a bit and let's talk about what's going, going on in the energy trade at the moment. Again, we get a lot of questions from folks saying I don't have time to get expert in specific names but I just know I need to get exposure to this sector. So what are the kinds of ETF solutions by subcategory of energy that you're seeing?

[Shauna Smith]

You know, there are a number of ways and we think about it at Global X, almost as in three buckets, specifically with energy, it's been grabbing the headlines, right. In terms of the massive rise that we've seen in oil prices, what exactly that means for your portfolio. Is it too late to buy some of those names, right. This dramatic, Is it too late? You know, that's a great question and I. You are right. So let me, let me try to answer it. Do I think oil is going to remain at the levels. We obviously have seen a huge pullback here today. We're right below 90 bucks a barrel. Are we going to remain at levels above $100 a barrel for a extended period of time? Probably not. Right. So what ultimately does that mean for the names that you have within your portfolio? And maybe where does it make sense to add a little bit of exposure? So you have the upstream and the upstream. There's a number of funds. We have one. One of the funds that we have at Global X is LNGX and that's exposure to natural gas. And so think of this as more as your producers when it comes to the oil trade. Big oil, not obviously in LNGX all the way, but when it comes to the upstream side of the equation and what exactly that means now, more sensitivity to commodity price swings. Right. Because it has a little bit more correlation. So, so if you're not convinced that oil staying at the levels that it is at, if you're, if you have, if you're in the camp that you think oil is going to come back a little bit, we likely think it's going to settle in the 70, 75 per barrel range, then maybe that isn't your best bet at this point, not saying it's a bad bet, but saying maybe that doesn't make the most sense for your portfolio. If that is the case, you do have other options. One is the midstream component of this. So that's more, less so tied to the swings that we're seeing in the price of the commodity. More so when it comes to volume. So think of almost the plumbing of your energy infrastructure. Trade, the pipelines. Exactly. When it comes to the liquefigation of natural gas, that trade. We think that there is certainly reason to be optimistic. We talk about the fact that we think oil prices are going to settle back down a bit. Maybe not to the levels that we were seeing back in the beginning of January when it was in the 5560 range. If we do settle around 70, 75, there is reason to believe that that' a sweet spot for this trade. So you have the midstream component and then you also have, at least at Global X we have another fund offering that's mlpa and this is more of the MLP exposure. Now a very different reason why you would have that in your portfolio. This is more for income generation. Very popular amongst retail investors. When it comes to why you would have that, obviously you're getting exposure to the energy space. Overall. We talk a lot about the fact that investors typically tend to be not as exposed to energy as maybe they would think. Only about 3% of the S and P is driven by energy. So you're not getting the exposure to this sector from some of your broader market averages. If you want that exposure to MLPs, you want it more of an income basis, then that could be when this trade makes sense. I think we are seeing more and more interest obviously just given the macro headlines and what has been going on. It is important. Like we said, going back to one of the first points I made in terms of diversifying your portfolio, you want to make sure what you own makes sense. If you're of the belief that we are going to see prices rise to the moon and we're going to be above a hundred dollars a barrel for quite some time, you might want to bet on some of those upstreamers if you think that, hey, maybe we will see a bit of a retracement here to some of the levels that we had seen in the past, maybe not back to 50 to 60 more in the 70 range. There is reason to believe that then. I think it's a very strong argument for the midstream players to make sense and we talk about the fact that there's a structural change going on right now within the energy sector and that of course then plays and strengthens that midstream argument.

[Devin Emery]

Not a lot of people talk about midstream and mlp. So really appreciate you bringing that up. And note to myself that something we should dig into further. Last sector for you, Shauna, talk to us about defense tech because this is one where everyone is talking about Palantir, right? Everyone's talking about drone technology. Where do you think about where there are opportunities still to get value? And the interesting thing is you look at some of the traditional defense stocks, they haven't moved actually with the sort of acceleration you might expect given the environment we're in at the moment. So where are you looking in that?

[Shauna Smith]

No, they haven't. So we have one of our funds at Global X is Shield shld and this gives you exposure to this space. Great ticker to the fund. It's a great ticker. It's one of the things that Global X has been very, very smart, great product team there in terms of support, that creativity around some of our tickers. But shield, SHIELD has seen a tremendous outperformance in relation to the broader market. You're Talking about a 2025 gain, I want to say, in between 60 to 70%. Not necessarily projecting a replication, the fact that we could replicate performance like that. But we still think there's a tremendous amount of growth within this sector and

[Devin Emery]

what's in it, what's in SHIELD So there's a mix.

[Shauna Smith]

So you mentioned Palantir, one of the top holdings, Lockheed Martin, going back to your earlier argument there, just some of those legacy holdings. So it is a mix of legacy and it is a mix of more of those tech focused companies that are changing how and why and when we spend on defense and what exactly that looks like and what the components are there. So it's more of a broader exposure to that space. And we do that in a very systematic and intentional way. Right. We want to capture the traditional sector. We still think there's a lot of opportunity within there. You talk about a name like Lockheed Martin, one of the top holdings within the firm, Palantir. You're pausing and smiling about the best way to say this. Palantir is a company that's very much up for debate in terms of what that valuation looks like. Is it or is it not attractive? What exactly is that return going to look like over the next three, six year out? Take a longer term outlook on this. When you think about what spending is going to look like here in the US Global defense spending as a whole is expected to trend to the upside. The unrest that's happening right now in the Middle east, the depletion of drones and what we are seeing on that front, that is going to then further boost demand for this type of technology that Palantir has. It's also going to boost demand and what that is going to look like for the more traditional players within this space. So we think it's very important to kind of have that balance between the two. And so it's not all growth, it's not all boring value. But I think when you pair it together in a name like shield, it is almost a perfect way to get that exposure to the growth and to the spending that we continue and do continue to expect to see now for years to come.

[Devin Emery]

For the record, I think value is very glamorous and exciting. I love boring. A boring value.

[Shauna Smith]

There we go.

[Devin Emery]

Shauna Smith, thank you. Well, great conversation with Shauna Smith. Thank you very much to her. That's a senior investment strategist at Global X. Let's take a break and when we come back, spin through the headlines that are also moving the markets today. John, are you a multi hyphenate?

[John Curto]

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[Devin Emery]

The closing bell 4pm right now on the east coast and the markets wrapping up for the day. Let's take a look at those major indexes the S&P 500 up up 1.15% for the day. And in fact there was green across the screen. We saw the NASDAQ up 1.38%. We saw the Dow up the same amount too. And just a quick pause to look at the vix, which is otherwise known as the Fear index, we saw IT come down 1.23%. In keeping with some of the reactions to the news from the White House today, while some other market headlines we saw activist investor Elliott Management biting into yet another public company. So far we've surveyed Elliott's recent stakes in the dental company Align Technologies, in Pepsi, in Norwegian cruise lines and also in Lululemon. And today shares of synopsys gained over 4%. That's after the Wall Street Journal reported that Elliott has built a multi billion dollar investment in the company. Market cap by the way, of the company over $83 billion trading under the ticker SNPS on the NASDAQ. But just a bit of background here. Synopsys is a leading provider of electronic design automation software. Think of that as a CAD for the sector as well as a provider of silicon IP and software security tools used by engineers to design and verify and ultimately for the use in the manufacture of complex AI driven chips. And Synopsys customers include major names such as intel and Alphabet and Tesla. So this is a big part of the value chain. Elliot said Synopsys is, quote, uniquely positioned to benefit from the growth in AI applications, but fundamentally believes that the company's financial performance doesn't yet fully reflect the value it delivers. Just to frame that, Synopsys shares have been down around 4% over the past 12 months and 9% year to date. Not exactly reflecting its role in the eyes of Elliot in the AI boom. And the investor now planning to help the company quote, align operational execution, profitability and monetization. Keep on watching that one. And finally for today, K pop band bts. After three year and nine month hiatus, yes, folks have been tracking closely. BTS has returned to the stage. That's after the group completed mandatory South Korean military service, marking their return to Civi street with a massive free concert in Seoul, a new album titled Arrow Range, A R I R A N G, an upcoming world tour, and of course a Netflix documentary. But shares in Hybe Corporation didn't get the pop, yes pun intended that investors had been hoping for. Hybe is the parent company of Big Hit Music, which manages BTS and it's listed on the Cosby Exchange. Hybe is a major South Korean entertainment conglomerate formerly known as Big Hit Entertainment, and it saw its stock fall 15% because that Seoul concert drew a much smaller crowd than had been expected, according to Reuters. Local authorities said around 100,000 fans attended, pretty significantly below forecasts of 260,000. It's an inauspicious start to the largest tour in the group's career. 79 shows are planned across 23 countries, and given how heavily Hybe has relied on BTS over the years, investors are watching closely as this unfolds for a bit of context. In a 2024 earnings call, Hybe CEO said BTS once accounted for about 95% of the company's revenue, falling over time to about 20% as Hybe diversified, anticipating that the group would have to do military service at some point. So this one going to keep watching to see if fans show up globally and whether the stock recovers. That's it for today's Brew Markets Daily

[John Curto]

Brew Markets Daily is hosted by Anne Barry and produced by John Curto, Tarek Abdulatif, Oven Laroya and Emily Milleher. Technical direction by Lonnie Fiskas. Brittany Dottocco is our audio engineer and the president of Morning Brew Inc. Is Devin Emery.

[Devin Emery]

Wake up tomorrow with the Morning Brew newsletter and tune in to Neil and Toby on Morning Brew Daily. We'll see you back here tomorrow, same time, same place.