2025 Stock Picks: Opportunities in AI, Earth Observation, and Commodities

With Donald Trump returning to the White House and Republicans likely to control Congress, the 2024 election results signal major shifts in U.S. technology policy - one of the world’s largest importers and exporters.

President-elect Donald Trump plans to repeal President Joe Biden’s executive order on artificial intelligence (AI) security, signaling a move toward deregulation for AI companies. His nomination of pro-business Silicon Valley leaders reflects a focus on fostering innovation in the sector. Trump’s selection of a prominent China critic Jacob Helberg for a key State Department role highlights his intent to compete with China in AI. Analysts, including Ruby Scanlon from the Center for a New America Security, predict a strong emphasis on surpassing China in advanced AI capabilities.

That said, several themes and markets could benefit investors as new policies take effect, while political tensions between the two economic giants impact consumers and markets.

Artificial Intelligence (AI)

According to Forbes, 2025 is expected to see growing demand for storage solutions as AI data processing expands. AI will improve storage efficiency and security, with sustainable architectures shaping data centers. One key segment, datacom links - which enable communication between servers, data centers, and networks via fiber optics - is growing rapidly. Valued at $4.8 billion in 2023, the market is projected to reach $10.9 billion by 2028, with a compound annual growth rate (CAGR) of 17.7%, driven by rising demand for high-speed, reliable data transmission.

The three key AI segments are:

POET Technologies could play a significant role in the AI value chain by designing optical modules for AI systems and data centers using its Optical Interposer platform to integrate electronic and photonic devices. Their products support AI, 5G, and machine communication. POET has signed an agreement with Globetronics in Malaysia to produce optical engines and acquired a minority stake in its Chinese joint venture. Additionally, the company completed a $25 million public offering, strengthening its position in AI and telecommunications.

The deal in Malaysia supports the company’s “China plus one” strategy to enhance global manufacturing capabilities.

Earth Observation

According to the World Economic Forum, global cooperation is declining, while conflicts are rising. Escalating geopolitical tensions are driving demand for continuous monitoring, particularly for military and maritime applications. Earth observation (EO) imagery is expected to rise in demand as it provides vital, unbiased intelligence for tracking conflicts, verifying treaties, and guiding decisions in a fragmented world.

Planet combines satellite monitoring with low-latency tasking to deliver timely intelligence for dynamic geopolitical landscapes. Its machine learning analytics equip intelligence and defense organizations with data for informed decisions and crisis management.

In Q3, Planet reported an 11% year-over-year revenue increase to $61.3 million, with 97% of it from recurring ACV (Annual Contract Value) and a 4% rise in customer count to 1,015. Key achievements include:

• Securing an eight-figure international defense contract for satellite imagery and analytics
• Launching a seven-figure U.S. defense pilot for satellite insights
• Receiving a $19.95 million NASA order under the CSDA contract
• Renewing a seven-figure deal with Brazil’s police for illegal activity monitoring
• Signing a multi-year agreement with German Space to support DLR’s Earth data platform
• Partnering with Laconic in a seven-figure deal for forest carbon monitoring

Commodities

Gold

Gold is set for its best annual performance in over a decade, rising 28% through November, driven by strong central bank and investor demand despite weaker consumer interest. Lower yields, a declining U.S. dollar (possibly impacted by Trump’s trade policies), and gold’s role as a hedge against market volatility and geopolitical risks have supported its growth.

Looking ahead, potential trade wars, inflation, and subdued economic growth may influence gold’s performance. Stronger central bank demand or financial instability could provide upside potential, but rising interest rates could pose challenges. For investors, options include exposure through gold mining stocks like AngloGold Ashanti, Gold Fields, Harmony Gold, DRD Gold or exchange-traded funds (ETFs). 

Rare Earth Elements (REE)

Rare earth elements, crucial for AI and tech, are central to the conflict between the U.S. and China. In December, China announced a ban on exporting rare minerals to the U.S., escalating tensions following the Biden administration’s restrictions on advanced American technology exports. Trump’s promise to impose heavy tariffs on Chinese goods could further intensify the tech war.

Shares of Australia’s Lynas Rare Earths rose to a near three-week high after the ban. As one of the world’s largest producers outside of China, it operates high-grade rare earth mines and is key to U.S. efforts to reduce reliance on China. Lynas plans to open a processing plant in Texas within two years, backed by over $300 million in Pentagon contracts. An industry expert predicted a market rebound by 2025 or early 2026, with inventories expected to decrease and prices to rise, following supply chain disruptions.

Copper

Copper is becoming increasingly vital to the global economy as digital transformation and the AI boom drive demand for electronics and data centers. Used in wiring, connectors, switches, and power control units, copper plays a key role alongside metals like lithium and nickel in data center operations. Global demand for copper in this sector is projected to grow by 20% by 2030.

Steady global GDP growth is expected in 2025-26, with stronger growth in China or the U.S. likely to boost copper demand and prices further. With a positive macroeconomic outlook, companies like Orion Minerals are advancing projects such as the Prieska Copper Zinc Mine and Okiep Copper Project, expecting production by late 2025.

Graphite

The global graphite market is expanding due to high demand from the EV battery sector, with China controlling 70% of production and 90% of processing. Efforts are underway to diversify supply chains with investments outside China.

Nouveau Monde Graphite Inc. secured $50 million to fund a Quebec facility for EV battery materials. The investment supports a refining plant for active anode material, with a final decision expected in early 2025. The CEO stated, "This is one of the most advanced graphite projects in North America."

What to Watch

Investors evaluating opportunities under a Trump administration should consider the impact of tariffs and trade tensions, particularly with China. The following sectors could experience significant shifts:

• AI: High growth potential in datacom links, processors, and advanced software
• Earth Observation: Increasing demand for satellite intelligence amid geopolitical conflicts
• Commodities: Volatility in gold, rare earths, copper, and graphite

Diversification across sectors and geographies, with a focus on companies benefiting from shifts in trade and technology policy, could be key to navigating dynamic markets. ETFs (exchange-traded funds) offer a convenient way to diversify by providing exposure to a range of assets or sectors. For example, commodity ETFs can invest directly in commodities like gold or oil, or track multiple companies involved in their production.

In AI, Actively Managed ETFs like EasyETFs AI World AMETF invest across the AI value chain - from foundational technologies to real-world applications - capturing growth from AI adoption across industries.

Conclusion 

The 2024 election results could signal a transformative era in U.S. technology and trade policy under Donald Trump’s administration. Key sectors, such as artificial intelligence, earth observation, and commodities, including gold, rare earths, copper, and graphite, could be poised for growth and volatility. As the U.S.-China rivalry intensifies, investors may want to focus on diversification and strategic exposure to industries likely to benefit from evolving policies and market trends. By staying informed and adaptable, investors can position themselves to navigate these opportunities effectively.

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