Trump Unveils $1.5 Trillion Defense Budget, Issues Executive Order on Contractors
President Donald Trump has announced a $1.5 trillion defense budget for next year, alongside an executive order restricting U.S. defense contractors from paying dividends or buying back stock until they boost weapons production. This move spurred a rally in European defense stocks, while U.S. contractors initially stumbled before rebounding.
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President Donald Trump donald trumphas made a significant policy announcement, revealing a $1.5 trillion defense budget for the upcoming fiscal year. This move, coupled with an executive order aimed at U.S. defense contractors, has sent ripples through global markets. The executive order prohibits these contractors from paying dividends or repurchasing stock until they accelerate weapons production, a measure intended to bolster defense capabilities amid rising geopolitical tensions.
The announcement triggered an immediate reaction in the financial markets. The European aerospace and defense index surged by as much as 2.1% on Thursday, reaching a new all-time high before settling to a gain of around 1% by mid-morning. Notably, shares of BAE Systems climbed 6.3% to reach October highs, leading the charge among UK-listed companies. Chemring Group saw an increase of around 2%, while other European defense firms like Leonardo , SAAB , Rheinmetall , and Renk Group experienced gains between 1% and 3%.
