Defense Stocks Slump Amid Fears Democrats Could Hold Back Military Spending
By Mauro Orru
Shares of major defense groups are in decline after Democrats clinched majorities in both chambers of Congress, an outcome that analysts say could weigh on U.S. military spending and dent demand for contractors.
Shares of Lockheed Martin, Northrop Grumman and RTX Corp are all down more than 2% premarket. In Europe, Germany's Rheinmetall is down over 2%, while the U.K.'s BAE Systems is down 5%. In France, Thales shares are down 3.8%, while Italy's Leonardo is down 2.6%.
Earlier this year, President Trump released a budget proposal seeking $1.5 trillion in defense spending for fiscal 2027, including funding for the Defense Department and critical munitions in an effort to expand the defense industrial base. However, the proposal hasn't been approved.
While the House advanced a roughly $1.15 trillion defense bill in July, some issues remain unresolved. Jefferies analysts wrote in a note to clients that control of Congress will determine leverage around the eventual funding outcome.
Write to Mauro Orru at mauro.orru@wsj.com
(END) Dow Jones Newswires
November 04, 2026 04:41 ET (09:41 GMT)
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