VERAVEX
PHASE PLAYBOOK
Veravex is a geopolitical cycle analysis publication. The Phase Playbook documents historical sector behavior observed during prior cycles and identifies current cycle signals. Nothing in this publication constitutes investment advice, a recommendation, or a solicitation to buy or sell any security. All readers make their own independent investment decisions.
PHASE PLAYBOOK — MAY 1, 2026 — BOTH CYCLES ACTIVE
WAR ECONOMY CYCLE
PHASE 04
NEGOTIATION
IN PLAIN ENGLISH
Active conflict is ongoing but both sides are exploring a deal. The fighting hasn't stopped, but back-channel conversations have started. This is the phase where envoys travel, intermediaries get involved, and the terms of an eventual agreement begin to take shape — usually without any public announcement.
WHAT THIS HAS LOOKED LIKE BEFORE
Look at Iraq after the 2003 invasion, or Libya after Gaddafi. In both cases there was a period — sometimes months — where the fighting was winding down but no peace deal existed yet. During those periods, a consistent pattern emerged across markets: defense companies stayed busy but weren't getting big new contracts. Oil prices swung wildly on every rumor. Construction and infrastructure companies started talking about "opportunities" but signed nothing. Banks did preparation work in private. And in every case, the clearest sign that the negotiation phase was truly over was when a US company announced a contract to build something permanent in the conflict zone — specifically a nuclear power plant, which requires a long-term legal framework to exist.
WHERE THINGS STAND TODAY
Right now, the Iran situation is stuck. A planned meeting in Pakistan between US envoys and Iranian officials fell apart on April 25 — the Iranian foreign minister left before the Americans even arrived. No new meeting has been scheduled. The Strait of Hormuz — the narrow waterway that about 20% of the world's oil passes through — is still blocked. The UAE, one of the world's largest oil producers, just announced it's leaving OPEC starting May 1. That's a big structural shift in how oil markets work, and it's happening at the worst possible time for a deal.
WHAT THIS MEANS FOR SPECIFIC SECTORS
Defense (LMT, RTX, NOC)
PLATEAU — ELEVATED
BACKGROUND:Companies like Lockheed Martin and Raytheon make weapons systems — jets, missiles, radar systems. When a war is happening, governments order heavily from them. Once both sides start negotiating, new orders tend to slow, but the contracts already signed keep getting paid. History shows these companies stay busy during negotiation phases.
TODAY:Right now, Lockheed and Raytheon's existing contracts are still being fulfilled. No new wave of contracts has started — but none has stopped either. The pattern matches what's been seen in prior negotiation phases.
Energy (XOM, CVX)
HISTORICALLY VOLATILE
BACKGROUND:Oil companies like ExxonMobil and Chevron make more money when oil prices are high. When a major shipping route is blocked, less oil reaches the market, prices go up, and energy companies profit. During negotiation phases, oil prices have historically swung wildly — a rumor of progress sends prices down, a breakdown sends them back up.
TODAY:The Strait of Hormuz is still blocked, which is keeping oil prices elevated and energy company margins high. The UAE leaving OPEC on May 1 is a new wrinkle — they want to pump more oil than the cartel allowed, but as long as Hormuz is closed they can't ship it anyway. When Hormuz reopens, energy prices could drop fast.
Reconstruction (Bechtel, Fluor)
HISTORICALLY QUIET
BACKGROUND:Companies like Bechtel and Fluor physically rebuild countries after conflicts — roads, power plants, hospitals, water systems. They don't get paid until there's actually a peace deal. History shows their stocks barely move during negotiations and then reprice sharply the moment construction contracts are announced.
TODAY:Nothing has been announced. No contracts, no letters of intent, no management commentary pointing to Iran specifically. This is consistent with prior cycles at this stage.
Nuclear (Westinghouse, NuScale, GE Hitachi)
KEY SIGNAL TO MONITOR
BACKGROUND:These companies build nuclear power plants. After a conflict destroys a country's infrastructure, it needs power. A nuclear plant contract is a 20-30 year commitment that requires a stable legal and political framework — you simply cannot build one in a war zone. That's why a US nuclear reactor contract in the conflict zone has historically been the clearest signal that a peace deal is truly finalized, not just announced.
TODAY:No contract has been announced. Watch for any news involving Westinghouse, NuScale, or GE Hitachi and Iran in the same sentence — that's the signal that changes the picture.
Banking (JPM, GS)
HISTORICALLY QUIET UNTIL PHASE 5
BACKGROUND:When a country needs to rebuild after a war, it needs to borrow money — often billions of dollars. JPMorgan and Goldman Sachs are the banks that structure those loans. They do the preparation work behind the scenes during negotiations but announce nothing publicly until the deal is signed. One historical signal worth knowing: Goldman partners rotating into government jobs 6-12 months before a deal closes has repeatedly preceded the announcement.
TODAY:Nothing public from either bank related to Iran debt structuring. No known government rotation from Goldman. Consistent with the pre-Phase 5 quiet period.
WHAT TO WATCH FOR
Two things happening close together have historically marked the end of this phase: (1) a senior US envoy travels to Oman or Qatar and meets with Iranian officials — a new meeting after the Pakistan collapse, and (2) Westinghouse, NuScale, or GE Hitachi announces a nuclear reactor contract for Iran. When both happen within weeks of each other, the negotiation phase is over and the rebuilding phase begins. You don't need to predict it — you just need to watch for it.
TECH COLD WAR CYCLE
PHASE 03
SUPPLY CHAIN WAR
IN PLAIN ENGLISH
The US and China are in an active technology competition. Both sides are restricting what the other can access — the US limiting advanced chips, China limiting rare earth minerals — while simultaneously building alternatives at home. This phase doesn't involve military conflict; it's an economic war fought through export controls, tariffs, and supply chain restructuring.
WHAT THIS HAS LOOKED LIKE BEFORE
The last time this happened at this scale was 2018-2022, when the US banned Huawei from American technology and started restricting what chips could be exported to China. During that period, two things happened simultaneously: companies building chip factories inside the US did very well, and companies that depended on Chinese manufacturing or Chinese customers did poorly. The split lasted for years — longer than most people expected. That's the historical template for what this phase looks like.
WHERE THINGS STAND TODAY
Right now, the tech competition is active but showing early signs that both sides might be open to some kind of arrangement. The US just allowed Nvidia to sell some advanced chips to China again — but with conditions attached, including the US taking a cut of revenue. At the same time, the core restriction hasn't changed: China still cannot buy the most advanced chip-making machines from a Dutch company called ASML, which means China cannot build its own cutting-edge chips. Meanwhile, TSMC is building a major chip factory in Arizona on an accelerated timeline — first chips expected in 2027.
WHAT THIS MEANS FOR SPECIFIC SECTORS
Domestic semis (SOXX, Intel, Micron)
HISTORICALLY OUTPERFORMED
BACKGROUND:The US government is spending hundreds of billions of dollars to build chip factories inside America — so the US doesn't have to depend on factories in Taiwan, which China considers its territory. Companies connected to building those domestic factories have outperformed in every comparable historical period.
TODAY:The TSMC Arizona factory is being built faster than originally planned. US government funding continues to flow. This is a multi-year structural story that doesn't depend on any single piece of news.
Nvidia
HISTORICALLY VOLATILE
BACKGROUND:Nvidia makes the most powerful AI chips in the world, and China's AI companies desperately want them. When the US restricts Nvidia's ability to sell to China, Nvidia's stock drops. When the restrictions are partially lifted, it recovers. This cycle has repeated: restriction → drop → partial re-engagement → recovery.
TODAY:Nvidia can now sell some chips to China again, but under specific conditions. The most powerful chips (Blackwell) are still off limits. If Nvidia's CEO Jensen Huang travels to Beijing, that would historically signal the two sides are seriously talking about a broader arrangement.
Apple
HISTORICALLY PRESSURED
BACKGROUND:Most iPhones are still made in China. If the US-China relationship deteriorates, China could make Apple's life very difficult — restricting its factories, closing its App Store, or pressuring Chinese consumers to stop buying Apple products. History shows Apple's stock trades at a discount during this type of phase until the company either proves it has diversified enough or the two sides reach an agreement.
TODAY:Apple is moving some manufacturing to India and Vietnam, but most iPhones are still made in China. Tim Cook traveling to Beijing would historically signal that Apple is part of a broader US-China technology negotiation — that's the signal to watch.
China tech (KWEB, BABA)
HISTORICALLY UNDERPERFORMED
BACKGROUND:Chinese technology companies — Alibaba, Tencent, and others — trade on US markets. During technology competition phases, these stocks have consistently underperformed. Investors worry about US sanctions cutting them off from Western technology, the risk of being delisted from US exchanges, and restrictions on the advanced chips they need to run their AI systems. History shows this doesn't reverse until a formal deal channel opens.
TODAY:The core restriction — China can't buy advanced chip-making machines — hasn't changed. No deal channel has opened. Current conditions match the historical underperformance pattern.
Rare earth miners (MP Materials)
HISTORICALLY ELEVATED ON RESTRICTION SIGNALS
BACKGROUND:Rare earth minerals — with names like neodymium, dysprosium, and terbium — are used in everything from iPhone screens to electric car motors to missile guidance systems. China controls the majority of the world's rare earth supply. When China restricts exports as a negotiating tactic, companies that mine rare earths outside China suddenly become very valuable. US domestic rare earth production has consistently attracted investment during this type of phase.
TODAY:China hasn't activated a new rare earth restriction yet. But domestic US rare earth mining is growing regardless, because the long-term strategic case for not depending on China doesn't change with the news cycle.
WHAT TO WATCH FOR
The clearest signal that this phase is ending: the TSMC factory in Arizona starts producing advanced chips. That's targeted for 2027 — when it happens, the US no longer depends entirely on Taiwan for the chips that run everything. Before that, watch for two early signals: (1) Nvidia's CEO or Apple's CEO travels to Beijing for meetings, and (2) China temporarily lifts some rare earth restrictions as a goodwill gesture. Those two things together have historically signaled that a broader arrangement is being negotiated.
◈ CONVERGENCE READ
BOTH CYCLES IN SIMULTANEOUS ACTIVE PHASE
Two separate economic storylines are running at the same time right now — the Iran war and the US-China tech competition. That's unusual and historically significant. When this has happened before, the war story has tended to dominate the headlines and the market moves, while the tech story played out more slowly in the background. The companies that have historically done best when both stories are active simultaneously are defense companies (because of the war) and US chip companies (because of the tech competition). The scenario that would change both stories at once: a peace deal with Iran that also includes some kind of US-China technology agreement — China gets some chip access back, the US gets rare earth security. Nobody has announced anything close to that yet.