When the State Becomes an Investor Again
Far from the myth of the free market, governments have once again become the primary architects of growth. Defense, space, nuclear energy, and raw materials: public funds are reshaping the global landscape of stock market performance. A new era has dawned, that of unabashed state capitalism.
The Resurgence of Public Intervention
For decades, economic orthodoxy extolled the virtues of state disengagement. That era seems to be over. Since the pandemic and the rise of geopolitical tensions, governments have taken the reins of investment through subsidies, industrial plans, and massive public orders.
From defense to energy transition, including space and nuclear industries, market logic is giving way to security and sovereignty imperatives. This direct intervention now shapes asset prices. « Where public money goes, market increases often follow, » summarizes Martijn Rozemuller, CEO Europe of VanEck, a company specializing in thematic ETFs.
The numbers speak for themselves: in 2024, global military spending increased for the tenth consecutive year, reaching $2.7 trillion, a historic record according to SIPRI (Stockholm International Peace Research Institute). The effects on the markets are immediate: the VanEck Defense UCITS ETF, which tracks major defense stocks, has surged 60% since its launch in March 2023. Meanwhile, the VanEck Space Innovators ETF, exposed to the new space economy, has soared by 109% over twelve months, while the ETF dedicated to nuclear has risen by 81% since the start of the year.
These spectacular increases are no accident. They reflect a global phenomenon: the resurgence of industrial policies fueled by Sino-American rivalry, the war in Ukraine, and the desire to reduce energy and technological dependence.
The Geopolitics of Investment
The state is no longer just acting as a regulator; it is becoming an indirect shareholder through its investment plans and strategic orders. In defense, the increase in military budgets supports European and American industrial companies, whose order books are filling up for years. In the space sector, public programs—satellite constellations, navigation systems, or surveillance missions—are driving the growth of private companies now closely tied to the military and national agencies.
The nuclear sector is also experiencing a second golden age. Influenced by the energy crisis, climate goals, and the rise of artificial intelligence—which is electricity-intensive—many countries are reviving their investments. The United States, France, the United Kingdom, South Korea, and Poland are multiplying reactor projects and small modular reactors (SMRs). In 2025, the VanEck Uranium & Nuclear Technologies ETF has grown by nearly 85% year-over-year, reflecting a global enthusiasm.
Even precious metals are benefiting from this wave of intervention. Central banks are purchasing gold to strengthen their reserves amid a reassessment of the dollar's hegemony. In 2025, gold surpasses $4,000 per ounce, and the VanEck Gold Miners ETF soars by 125%.
This new financial geography highlights the rise of sectoral ETFs, preferred tools for capturing major public trends while staying diversified. However, it also has a downside: when political support is withdrawn, markets correct sharply.
Harnessing Power Without Getting Burned
For investors, this era of deliberate interventionism calls for a renewed interpretation of cycles. Macro-economic analysis alone no longer suffices; it is necessary to understand government budgets, geostrategic priorities, and windfall effects on industrial sectors.
While public money creates opportunities, it also increases political volatility. A power shift, a change in energy doctrine, or a diplomatic reversal can alter the valuation of an entire sector within months. Hence, it is crucial not to confuse structural trends with mere announcements.
According to Martijn Rozemuller (VanEck), « investors need to remain vigilant: periods of significant government support can lead to excessive valuations. » The key lies in a balanced asset allocation, through well-diversified ETFs, allowing participation in long-term trends without relying on a single national policy.
This logic reflects a deeper transformation: the end of the liberal paradigm in favor of state-driven capitalism. In a world of strategic rivalry, tracking public money has become as essential a practice as monitoring corporate results.
The investing state is no longer an exception but the new focal point of the markets. Between security, sovereignty, and industrialization, capital now follows policies. A shift in era... and a new analytical tool for investors.
This content has been automatically translated using artificial intelligence. While we strive for accuracy, some nuances may differ from the original French version.
