Global defense stocks surged Thursday, fueled by U.S. President Donald Trump’s call for a $1.5 trillion defense budget in 2027. The move sent ripples through markets, signaling a potential shift in military spending priorities.
“After the long and difficult negotiations with Senators, Congressmen, Secretaries, and other Political Representatives, I have determined that, for the Good of our Country, especially in these very troubled and dangerous times, our Military Budget for the year 2027 should not be $1 Trillion Dollars, rather $1.5 Trillion Dollars,” he wrote in a TruthSocial post late Wednesday.
“This will allow us to build the “Dream Military” that we have long been entitled to, and, more importantly, that will keep us SAFE and SECURE, regardless of foe.”
Northrop Grumman gained 6.8% in premarket trade Thursday, while Lockheed Martin rose 6.7%. RTX advanced 5.4%, and Kratos Defense was up 6.6%. Investors clearly reacted positively to the prospect of increased defense spending.
The Stoxx Europe Aerospace and Defense index added 1.4% in early trading Thursday. Renk and Leonardo initially led the European benchmark, climbing more than 4% before moderating gains to 1.5% and 3.6%, respectively. The enthusiasm extended beyond U.S. borders, indicating a broad market expectation of benefits from the proposed budget.
Asian defense names also saw increases, with Mitsubishi Heavy rising 2.4% and Bharat Electronics gaining 0.3%. The global impact suggests a widespread anticipation of increased demand for defense products and services.
The developments follow a weekend incident where U.S. forces captured Venezuelan President Nicolas Maduro and his wife during a large-scale overnight operation. American authorities stated Saturday that the couple had been indicted in New York on drug-trafficking charges. Trump subsequently announced the U.S. would take control of Venezuelan oil and renewed discussion about acquiring Greenland.
This is a breaking news story. Please refresh for updates.
