Several war stocks surged today following news of the Israeli strike on Tehran, Iran.
RTX Corporation (NYSE: RTX), for example, was up 6.01%, while Lockheed Martin (NYSE: LMT) and Northrop Grumman (NYSE: NOC) were up 4.20% and 7.66%, respectively, in pre-market.
The news of the attack also caused U.S. stock futures to drop -1.5%, while VIX futures went up 13%. Oil prices gained as much as 15% amid fears of crude oil shipment issues, before stabilizing at around $72 (+6%).
War stocks surge
During the strike, Israel deployed Lockheed Martin’s F-35 and F-16 jets, showcasing the company’s dominance in tactical aviation.
Moreover, since the Israeli Air Force retired its F-16C fleet last year, increased demand for Lockheed Martin’s flagship planes could be likely in the near future.
In addition to fighter jets, Lockheed also produces radar systems, smart ammo, and missile defense platforms deployed in the Middle East, which could further strengthen its presence in the region.
Northrop Grumman, known for stealth aircraft, global surveillance drones, and its key role in the F-35 supply chain, is thus also positioned to profit from Lockheed Martin’s increased footprint.
Similarly, RTX could see long-term demand across engines, aerospace systems, and defense missiles employed by Lockheed and NATO partners in the Middle East.
According to Chief Market Strategist Kenny Polcari, the ongoing developments have left the market “cautious but not panicking,” with further volatility in the defense sector being likely in the short term.
Featured image via Shutterstock
