Shares in defense firms across the globe climbed after US President Donald Trump advocated for a $1.5 trillion military budget in 2027, signaling a major boost to spending that analysts say could invigorate the sector amid heightened global tensions.
The surge extended gains from the previous day, with US contractors leading the charge in premarket trading as Trump detailed his vision for a strengthened armed forces.
“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,” Trump wrote on his Truth Social platform late Wednesday.
He added: “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.”
In the United States, Northrop Grumman shares jumped 8.3 percent, Lockheed Martin rose 7.9 percent, RTX advanced 4.8 percent, and Kratos Defense surged 12 percent.
European markets followed suit, with the Stoxx Europe Aerospace and Defense index up 1.1 percent, Germany’s Renk gaining 2.6 percent after an initial 4 percent spike, and Italy’s Leonardo closing 2.7 percent higher.
Asian counterparts also benefited, as Japan’s Mitsubishi Heavy Industries climbed 2.4 percent and India’s Bharat Electronics edged up 0.3 percent.
The proposal represents a 50 percent increase over the previously floated $1 trillion figure, underscoring Trump’s emphasis on military might in an era of geopolitical uncertainty, though it faces congressional hurdles before enactment.
