Sturnella Signals | Vol. 1 · Issue 025 · October 7th, 2026

Sturnella Signals | Vol. 1 · Issue 025 · October 7, 2026

Rates · Reactors · Rare Earths · Rearmament

Critical minerals · Energy infrastructure · Defense supply chains · Cyber

This Week in Sturnella Signals

Something interesting is happening between the ticker tape and the physical economy.

Treasury yields are near multi-decade highs, mortgage rates reached 7.49%, oil is back around $90 and the dollar has strengthened. Higher borrowing costs are putting pressure on everything from housing to AI infrastructure but at the same time, the Navy awarded Raytheon a $24.4 billion SM-6 production contract. The United States and South Korea are discussing a buildout that could include eight large nuclear reactors in the United States. The Department of War selected four directed-energy systems for operational counter-drone testing. DOE is funding new mining technologies and expanding its industrial assessment program directly into mining and mineral processing. And the Office of Strategic Capital is still building vehicles designed to push billions of dollars of private capital into critical technologies and minerals.

Yet many of the public companies tied to these themes have been falling. That disconnect is worth watching.

The government is increasingly buying the capacity. The market may still be asking who can build it profitably.

MACRO & GEOPOLITICAL SIGNAL

The Cost of Capital Is Back in Charge

Editor's note: This is market commentary, not investment advice.

The average 30-year U.S. mortgage rate reached 7.49% last week, its seventh consecutive increase and the highest level since November 2023. That is high. The 10-year Treasury yield pushed above 5.3% this week, reaching levels last seen in 2002, while the dollar index climbed above 102. Oil is also back near $90 as continued attacks and shipping risk around the Strait of Hormuz keep the possibility of renewed energy inflation alive.

That combination matters because: Higher oil → inflation risk → higher yields → higher cost of capital

We are beginning to see that flow through the market. AI infrastructure stocks have become more sensitive to rates and credit spreads. Housing is being hit directly through mortgage rates. Capital-intensive mining, nuclear and industrial projects face the same pressure.

Sturnella lens: The strategic demand may be enormous, but financing it is becoming more expensive.

The Ticker Tape vs. the Physical World

This may be the most interesting signal of the week.

U.S. defense stocks have experienced an unusually sharp pullback despite enormous procurement requirements. The iShares U.S. Aerospace & Defense ETF fell as much as 18.2% from its August 14 high, including seven consecutive weekly declines. Even a $24.4 billion multi-year SM-6 contract did not produce a meaningful rally in RTX shares.

Rare earths show a similar disconnect. MP Materials shares are down roughly 31% over the past year, despite continuing investment in domestic rare-earth and magnet capacity. Cameco had also pulled back sharply from its 52-week high before this week's renewed nuclear rally — and yet the physical demand story has arguably strengthened.

The United States and many other countries still need rare earths for magnets, uranium for nuclear power, copper for electrification, steel for infrastructure and defense, missiles and interceptors, power for AI data centers, and control systems to operate all of it.

The market appears to be separating strategic importance from near-term earnings and execution. Government support does not automatically create free cash flow. A company still has to turn: policy support → financing → construction → production → customer → cash flow

Sturnella lens: Washington can create demand, but the market still wants proof that companies can convert it into economics.

ENERGY INFRASTRUCTURE

Eight Reactors Is Not a Concept Study

The U.S.–South Korea investment discussions include plans for as many as eight large nuclear reactors in the United States, alongside major gas and power infrastructure investments. The proposed buildout includes six Westinghouse AP1000 reactors and two Korean APR1400 units.

That is important because this is not another announcement about an experimental reactor design twenty years from commercialization. These are large reactors based on existing designs.

Private-sector demand is reinforcing the story. Google and Constellation Energy announced a 20-year agreement supporting more than $4.3 billion of upgrades at 11 existing nuclear units, expected to add 890 MW of new capacity to the PJM grid, roughly the output of another large reactor. The driver is becoming increasingly obvious: AI needs electricity, and electricity that runs continuously is becoming more valuable. That brings nuclear directly into the AI infrastructure conversation.

Look underneath the reactor

Just as with the Iowa steel plant, the opportunity is not only owning the reactor.

Someone has to provide uranium, enrichment, fuel fabrication, valves and pumps, specialty steel, controls, instrumentation, cybersecurity, engineering, construction, maintenance and waste management.

The nuclear supply chain is an industrial ecosystem.

Sturnella lens: AI may be a software story at the top of the stack. At the bottom, it is increasingly a power-and-materials story.

DEFENSE INDUSTRIAL BASE

$24.4 Billion Says More Than the Stock Chart

On October 1, Raytheon received a five-year contract valued at up to $24.4 billion for Standard Missile-6 interceptors, with two additional option years. RTX says the agreement is intended to significantly expand SM-6 availability and production capacity.

Raytheon had already completed a $115 million expansion of its Alabama facility, and the company says production under the new agreement is expected to exceed 500 SM-6 units annually.

This is where the hiring and supply-chain signals appear. A missile production ramp creates demand far beyond the prime contractor.

The defense stock may move up or down this week. The factory still has to produce the missile.

Counter-Drone Moves From Demonstration Toward Deployment

The Department of War also accelerated its counter-UAS program this week, selecting four directed-energy systems for operational testing:

The pilot moves these technologies into operational environments to gather real-world data on performance, sustainment, cost and integration. This follows an October 2 directive aimed at reducing c-UAS approval timelines from months to days or weeks, including changes to spectrum, safety and legal-review processes.

That is the part I find important. The conversation is moving from can the technology work? toward how quickly can we deploy it at scale?

SMALL BUSINESS OPPORTUNITY

The Department Is Opening Another Door to Non-Traditional Companies

The Department of War's Critical Technologies Office announced a partnership with In-Q-Tel to identify and move commercially developed technology into military use more quickly. The partnership gives the Department access to In-Q-Tel's technology-scouting network and early-stage company portfolio, with joint pilots expected to focus on immediate operational bottlenecks.

The target areas include artificial intelligence, biomanufacturing, contested logistics, quantum and battlefield information dominance, directed energy and hypersonics.

For small and non-traditional businesses, the important language is not simply "innovation." It is transition. The Department is explicitly trying to shorten the distance between:

commercial technology → validation → operational evaluation → procurement

Sturnella lens: The opportunity isn't only inventing something new. It may be having something mature enough that the government can use now.

FOLLOW THE CAPITAL

OSC Is Becoming More Interesting

The Office of Strategic Capital deserves more attention than simply watching for the next individual award. OSC is increasingly looking less like a traditional government funding program and more like capital-market infrastructure.

Its National Security Fund Finance program will provide loans to investment managers who then combine that financing with private capital to invest in critical-mineral and material companies. Applications are due November 1.

Separately, the Small Business Investment Company Critical Technologies initiative has 19 approved funds expected to deploy more than $4 billion across more than 1,700 companies in the defense industrial base.

To be clear, that is different from a government grant. The government is trying to use leverage and private fund managers to create a much larger pool of investable capital.

The question I will be watching: where does that money actually land?

CRITICAL MINERALS

Mining Technology Is Becoming an Industrial Policy Tool

DOE's Office of Critical Minerals and Energy Innovation selected 17 National Laboratory projects for $29.5 million under its Mine of the Future initiative. The work ranges from AI-enabled ore sorting and autonomous underground mapping to lithium recovery, rare-earth processing, mine-tailings recovery and new comminution technologies.

This follows the $73 million announced in September for domestic mining technology demonstration projects.

DOE also opened another program this week that may be particularly relevant to smaller operators. Its Industrial Training and Assessment Center program will now include a new Track 2 specifically for mining and mineral-processing operations. The program pairs university engineering teams with industrial facilities to identify efficiency, technology and cost-saving opportunities. DOE says previous assessments identify an average of roughly $150,000 in annual savings per facility.

Applications for universities to operate the centers are due October 30.

This is worth watching because workforce, technology and operational efficiency are being treated as part of the same mining-policy problem.

FORTRESS America

Another announcement from the Department reinforces the same pattern.

FORTRESS America calls for major U.S. military installations to become less dependent on civilian infrastructure while strengthening domestic supply chains for rare earths, specialty metals, semiconductors and propellants. It also calls for hardened installations and independent power generation capable of operating through cyberattack or physical disruption.

That connects several themes we have been following:

critical minerals + energy resilience + defense manufacturing + OT cybersecurity

THE ATTACK SURFACE

Twelve ICS Advisories in Six Days

CISA issued six ICS advisories on October 1 and another six on October 6. The affected technologies include:

The systems being disclosed are increasingly the types of technologies sitting close to physical operations: protection systems, controllers, gateways and remote terminal units. That is precisely where IT, OT and third-party access begin to intersect.

Sturnella lens: More connectivity creates more capability. It also creates more things that someone has to inventory, patch, monitor and defend.

EARNINGS WATCH

October earnings should provide the next reality check. I will be listening less for headline EPS and more for whether companies can turn backlog and government support into production.

October 20 — Northrop Grumman Watch: missiles · space · program execution · labor

October 22 — Lockheed Martin Watch: backlog · missile production · supply chain · hiring constraints

October 22 — Newmont Watch: gold margins · costs · capital allocation · copper

October 27 — Freeport-McMoRan Watch: copper · Grasberg · U.S. expansion · capex

October 27 — Boeing Watch: production rates · defense backlog · supply chain · cash flow

October 29 — L3Harris Watch: missiles · electronics · Aerojet integration · leadership transition

November 2 — BWX Technologies Watch: naval nuclear · reactor demand · government backlog

November 4/5 — CF Industries Watch: natural-gas costs · fertilizer pricing · agriculture demand

November 9 — Barrick Watch: gold · copper · costs · production

The question I want answered is simple: are companies able to convert the demand we keep reading about into actual output and earnings?

WHERE WE'LL BE

Events & Speaking Engagements

OCT 28 — Women in Mining Nevada Nevada · Lunch & Learn From Mine Site to Board Packet.

NOV 5 — University of Utah Salt Lake City, Utah Mining Meets Risk: Cybersecurity and Operational Resilience on the Modern Mine Site.

DEC 9 — American Exploration & Mining Association Sparks, Nevada · Capital Markets Technical Session When the Mill Stops: A Cyber Incident Tabletop for Mining's Operational Technology.

MAY 2–5, 2027 — APCOM 2027 Montréal, Québec · Accepted Paper From Connected Equipment to Operational Resilience: Cybersecurity for OT/IT Convergence in Modern Mining.

Sturnella Signals

At the intersection of cybersecurity, capital markets and national security; following the capital, policy, technology and operational risks reshaping mining, energy, infrastructure and defense.

This publication is for informational purposes only and does not constitute investment, legal or cybersecurity advice. Market information is time-sensitive and may change after publication.

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