Hope you’re enjoying this round of Monopoly, the HALO Edition, where the most coveted asset on the board isn’t Boardwalk but a “Get Out of AI Jail Free” card.

The so-called “heavy assets, low obsolescence” (HALO) trade — which prioritizes investments insulated from the upheaval of artificial intelligence — was front of mind Monday. The S&P 500 fell 1%, as spooked investors circulated a note from research firm Citrini that imagines a scenario (it doesn’t predict one) in which there’s an AI-induced stock market crash before 2028.

Setback in the Future

The market has been undergoing a rotation to value stocks since the fall, with the AI hyperscalers that drove overall gains in recent years as flat as a Pepsi opened yesterday. And thus the back-to-basics HALO trade has taken on some shine. Simply put, focusing on “heavy assets, low obsolescence” means investing in sectors that will be spared from the next large language model refresh.

For example, AI could solve the Collatz conjecture tomorrow, sketch out a reliable theory of everything on Thursday and stop producing instances of subpar code by Friday and … you would still need to gas up your sedan. That’s a point in favor of oil and gas giant Exxon Mobil, a popular HALO trade whose shares are up 25% in 2026. It’s also February, you probably still need to keep warm, a point for heating and ventilation company Carrier Global, up 20% this year. And when noon rolls around, you’ll still need lunch, a point for both Deere, up 39% this year thanks to its machines that harvest your food, and McDonald’s, your cheat meal fallback that’s up 9%. Companies that make or own lots of specialized equipment, or that serve a large physical footprint, have a HALO. It glows especially bright on a day like Monday:

• A post by James Van Geelen, the ne plus ultra finance Substacker, and his firm Citrini Research drew widespread attention for its imagining of a 2028 in which AI has led to unceasing white-collar layoffs, handcuffed consumer spending power and, consequently, hammered economic growth. Ultimately, in this hypothetical scenario, the S&P 500 sinks 38%.
• Companies Citrini highlighted as being significantly (theoretically) disrupted did not have a good Monday: American Express fell 7.2%, and DoorDash fell 6.6%. Meanwhile, one leading software ETF fell 4.7%, reflecting continued broader fears about the sector’s AI exposure, and IBM had its worst day in a quarter-century, a 13% drop, after AI developer Anthropic said its Claude Code tool could modernize a programming language run on the company’s computers.

Lag Up: S&P 500 sectors like industrials, materials and utilities have already been outperforming the broader index for weeks. Some have even pilloried the once dominant Mag Seven tech stocks as the “Lag Seven.”

It’s the business equivalent of Modern Love: They’re going from being just partners to full-on family.

On Monday, pharma giant Gilead announced a $7.8 billion agreement to buy biotech firm Arcellx, in which it already held an 11.5% stake as part of a 2022 effort to co-develop and co-commercialize the cancer treatment anito-cel. According to Reuters, the developing relationship is just the latest example of pharma firms planting the seeds early for future M&A.

Cliffhangers

Gilead executives may well be running the longest countdown clock on earth, with all eyes on the April 1, 2036, patent expiration date for the company’s blockbuster HIV treatment, Biktarvy. While that seems like a long time, a decade can go by in the blink of an eye when the sales bedrock of your company is at stake; last year, Biktarvy generated roughly 50% of Gilead’s $29 billion in total revenue. (Note: Gilead also scored a three-year patent extension for Biktarvy last year, following a settlement with three generic drugmakers.)

The firm’s strategy isn’t unique: Just look at the industry’s M&A spree since last summer, as competitors face perilous patent cliffs of their own. At Gilead, the heat climbed even higher after some disappointing full-year numbers on its latest earnings call:

• Gilead forecast adjusted earnings of $8.45 to $8.85 a share for 2026, placing analyst expectations of around $8.79 a share at the high end of the range. Full-year revenue guidance of $29.6 billion to $30 billion also came in a bit cool relative to estimates of $29.9 billion.
• Particularly troubling for the company in 2025 were declining sales of its cell therapy drugs. Sales of non-Hodgkin lymphoma-treating Yescarta fell 5% from 2024, while sales of leukemia drug Tecartus slid 15%; sales for the cell therapy unit dropped 7% overall.

Neat-O: That makes acquiring Arcellx all the less surprising. Gilead’s biggest purchase since 2020, if completed, would give the company full rights to anito-cel, the CAR T-cell therapy that the two firms have been co-developing for patients with the blood cancer multiple myeloma. In fact, Chief Medical Officer Dietmar Berger teased the acquisition in the earnings call, promising a treatment breakthrough: “It’s a completely new paradigm to talk about curing myeloma and having the potential for a cure without any major side effects.” To buy itself a chance at said breakthrough, Gilead is paying a premium: The company is shelling out $115 per share for all outstanding stock of Arcellx, or roughly double what shares closed at ahead of the weekend. That’s one way to beat the Monday blues.

AI is headed to the front lines, with Anthropic’s Claude reportedly playing a role in the military operation that captured Venezuelan president Nicolas Maduro last month. Anthropic CEO Dario Amodei is expected to meet with Defense Secretary Pete Hegseth today to discuss the military’s use of its AI model.

It likely won’t be a friendly chat, with the focus on an ideological disagreement. Anthropic insists its AI shouldn’t be used for domestic surveillance or the development of automated weapons. But the Pentagon expects unfettered access to the product of the company it has a $200 million contract with.

That contract could be in jeopardy if Anthropic refuses to budge, especially as other tech companies clamor for a piece of defense spending.

Booming Budgets

President Trump’s budget plan for this year calls for $1 trillion in defense spending, and he suggested last month that he wants to up that bigger-than-ever allocation to $1.5 trillion. AI is shaping up to be a key part of that plan, with the Defense Department last month publishing its “AI Acceleration Strategy,” which calls for the US to have “the world’s undisputed AI-enabled fighting force.”

Major contractors, including Boeing and Northrop Grumman, have historically held the biggest piece of the Pentagon’s spending pie (92%, defense software company Govini told Reuters). But tech companies, after years of maintaining a degree of separation from the military, are now sporting military fatigues:

• Claude’s the only AI model operating in the military’s classified systems, but Anthropic’s not the only AI giant with a Pentagon deal. Google, OpenAI and xAI were also awarded contracts last year that leverage their AI tools.
• Startups are also earning a bigger share of defense spending as they develop tech for the front lines. Scale AI, a startup Meta’s investing more than $14 billion in, has teamed up with Anduril to develop virtual and mixed reality headsets for soldiers.

Fine Print: Tech companies are updating their terms and conditions to adapt to Trump’s defense-forward agenda. ChatGPT-maker OpenAI changed its policy from banning use of its tech for military and war purposes to allowing national security uses that align with its mission. Google’s code of conduct no longer restricts weapons development and surveillance uses as of last year. Meta, meanwhile, opened up its AI models to Lockheed Martin and Booz Allen Hamilton. Anthropic’s a rare holdout.