How AI could vaporize a huge portion of your retirement nest egg

Today’s issue in preview:

• How AI could vaporize a huge portion of your retirement nest egg

• An Epic Fury-induced boom. Oil and gas stocks continue their market leadership

• Epic Fury powers a bull market in coal stocks

An Epic Fury-induced boom. Oil and gas stocks continue their market leadership

Credit: bogdanserban

Over the weekend, more than 3,500 U.S. troops arrived in the Middle East, along with equipment used for amphibious assaults.

This development – plus a lack of positive diplomatic news – has the market on edge, dealing with the possibility that Operation Epic Fury escalates to a dangerous new level.

Brent crude oil – the global oil benchmark – climbed above $114 per barrel. Brent has soared 55% this month, its largest monthly rise on record. This is great for investors who followed our hugely profitable September 2025 recommendation to buy oil stocks.

Today, market leadership is – yet again – dominated by oil and gas stocks and a few industries profiting from the constriction of Middle Eastern critical resource supplies. The U.S. chemical and fertilizer industries fall into the second category. As Middle Eastern supply declines, the value of their “not Middle Eastern” supply rises.

Today, oil and gas giants ExxonMobil (XOM), Chevron (CVX), Shell (SHEL), Suncor (SU), Devon Energy (DVN), BP (BP), Occidental Petroleum (OXY), Cenovus (CVE), Antero Resources (AR), Equinor (EQNR), Permian Resources (PR), EOG Resources (EOG), and Petrobras (PBR) reached new one-year highs. Chemical giants Dow (DOW), Olin (OLN), LyondellBasell (LYB) and Celanese (CE) also reached one-year highs.

I’m chalking up today as another day in what I call “Groundhog Day for investors.”

It feels like we are living the same week over and over. The week goes like this: Donald Trump makes a claim about how well the war is going, hoping it will send oil prices lower. Iran issues a counterclaim and strikes another target. Oil prices go up. We hear the Strait of Hormuz might open. We hear the Strait of Hormuz is still closed. Stocks in a small number of industries that benefit from reduced critical resource supplies and corresponding high prices – oil, chemicals, fertilizers – go up. Most stocks go down or move sideways.

Rinse and repeat.

Groundhog Day for investors.

In this movie, critical price action in the broad market averages and most individual stocks is not being driven by industry fundamentals, valuations, or interest rates. It’s almost all being dictated by Operation Epic Fury and Donald Trump’s social media posts. Most of the market is trading in a unified “blob” that rises or falls based on how the war is going and how it is being spun in the media.

If the war ends soon, the S&P is very likely to pop higher and move higher over the long term. If the war does not end soon, its constriction of critical resource supplies will seriously damage the global economy, and stocks will trade lower. That’s all price action direction comes down to these days. It’s all quite tedious. But this too shall pass.

How AI could vaporize a huge portion of your retirement account

Credit: Bill Oxford

Of the varied types of stocks struggling during March’s Epic Fury-induced selling, few are suffering more than companies that the market believes are on the wrong side of AI.

In the past few trading sessions, software firms SAP (SAP), Adobe (ADBE), Dropbox (DBX), Fidelity National Information Services (FIS), Monday.com (MNDY), Atlassian (TEAM), and Trade Desk (TTD) reached new one-year lows.

Data and analytics firm CoStar Group (CSGP) reached a new one-year low.

Real estate data and services firm Zillow (Z) reached a new one-year low.

Language learning firm Duolingo (DUOL) reached a new one-year low.

Shares of the popular software development platform firm GitLab (GTLB) reached a new one-year low.

Sharp-eyed readers will note that all these companies fall into the vulnerable KIDS category I’ve detailed many times this year. These are the most vulnerable companies to AI-driven disruption. They are suffering some of the largest, fastest declines in stock market history. The declines are punching big holes in many investment portfolios.

KIDS is my acronym for Knowledge work, Information collection and analysis, Data collection and analysis, and Software.

Companies in the KIDS category sell digital products and services… things that AI can or will soon be able to create in virtually unlimited quantities. We’re talking consulting firms, real estate data providers, credit rating agencies, financial data providers, and software firms.

These companies sell products and services that AI programs are now producing at very low cost, or will be able to do so in the next few years. If someone using AI can code a product or service into existence, then any business related to it is in danger.

AI will put some of these KIDS work companies out of business. But keep in mind, it doesn’t have to put them out of business to make them stock market losers. AI only needs to lower the cost of producing what they produce over the long run. This will enable hordes of AI-centric competitors, which will throw a wet blanket on their growth rates, profit margins, and P/E multiples.

As a result, investors are selling stock in these companies with great enthusiasm.

Concern about companies in the KIDS category is also wreaking havoc in the office space sector. The kinds of companies mentioned above are major tenants of office buildings across America. Since AI threatens their business models, investors are dumping shares of their landlords. Shares of office space giants Boston Properties (BXP), SL Green Realty (SLG), and Vornado Realty Trust (VNO) recently registered new one-year lows.

The enormous amount of market value lost by the companies above shows you that AI-powered technological disruption isn’t producing just a “K-Shaped economy.” It’s also creating a “K-Shaped stock market.”

The salient feature of this market is the creation of both big winners and big losers at a breakneck pace. Review your portfolio for potential dangers in this new, fast-moving market.

Identifying powerful trends and getting on the right side of them early has never been more impactful to investment performance.

Epic Fury powers a bull market in coal stocks

Credit: agnormark

The oil and gas industry isn’t the only fossil-fuel-based industry getting a boost from Epic Fury and its constriction of critical resource supplies.

The coal business is booming as well.

As you read this, the Range Global Coal Index ETF (COAL) is reaching a one-year high, and many coal mining firms – including Peabody Energy (BTU) – are at or near all-time highs.

In our March 26 issue, I detailed why Operation Epic Fury and its consequences are long-term bullish drivers of virtually every industry related to electric power production.

These themes have generated extraordinary wealth and big capital gains over the past two years and are very likely to continue doing so.

Closing the critical Strait of Hormuz justifiably gets a lot of press. The Strait of Hormuz is a vital waterway through which roughly 20% of global oil consumption flows.

In addition to oil, vital natural gas and fertilizer supplies flow through the strait. Its closure is having destructive consequences for businesses and countries that depend on Middle Eastern resource flows. Those consequences could go from “destructive” to “catastrophic” if the closure lasts another month.

As I stated in my original piece, for many countries and businesses, this situation is a brutal “slap in the face” reminder: If you’re a large business or country whose survival or smooth operation depends on uninterrupted resource flows from the Middle East, you are in a dangerous, vulnerable position.

No politician, CEO, or major shareholder wants their business to be in that position. No citizen wants their country to be in that position. Many powerful and influential people are realizing this is a big risk that must be mitigated if humanly possible. Executives and politicians will get fired for not addressing it effectively.

This means building and buying as many forms of “not Middle Eastern” resource supply chains as possible economically… with electric power production being the most important.

The drive to become more energy independent is not a one-year-and-you’re-done project. It is a multi-decade megatrend. It will act as a long-term tailwind for virtually every form of energy production, helping businesses and countries become less reliant on Middle Eastern oil and gas.

This includes coal mining.

According to the International Energy Agency, coal-fired electrical power plants generate roughly 35% of the world’s electricity. It’s the largest single source of electric power generation globally. The U.S. Energy Information Agency estimates that coal generates about 75% of India’s electric power and about 60% of China’s.

The drive among many large businesses and countries to be as power- and resource-self-sufficient as possible will act as a powerful tailwind for coal miners and many other businesses related to electric power production.

Market Notes

• In addition to oil and gas producers, oil refiners are also enjoying an Epic Fury-driven bull market. Refining giants Valero Energy (VLO) and Marathon Petroleum (MPC) reached all-time highs today.

• Our recommendation to own oil and gas pipelines continues to pay off. Pipeline giant Energy Transfer (ET) reached a new all-time high today.

• Medical device giant Boston Scientific (BSX) reached a new one-year low today.

• GLP-1 blues? Pizza chain Domino’s Pizza (DPZ) reached a new one-year low today.

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Regards,

Brian Hunt
Editor, Money & Megatrends

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