The Week Ahead (12th-16th January) - Defence stocks zoom higher
Hello and welcome to the latest edition of the Week Ahead!
The first full week of 2026 is behind us, and it has been a strong start for the markets.
The Samp;P 500 is already up 1.3% year-to-date:
And the FTSE is already up 2%:
I’ve spent the past week or two trying to ignore global politics - particularly Trump’s intervention in Venezuela, and also the unrest in Iran.
The markets haven’t been ignoring it, however. And the ramifications of these events, however grisly this might be, have been positive.
BAE Systems (LON:BA.) , for example, is up by a remarkable 20% year-to-date.
The saying “elephants don’t gallop” has never really been true, and certainly not for defence stocks during times of international tension.
BAE hasn’t even issued a relevant announcement - the price action of this £60bn stock has been entirely driven by external news. President Trump, in particular, has asked for US military spending to rise by over 50% to $1.5 trillion in 2027 (2026 budget: $901 billion).
Such a spending bonanza would ripple through the entire defence sector...
The first full week of 2026 is behind us, and it has been a strong start for the markets.
The Samp;P 500 is already up 1.3% year-to-date:
And the FTSE is already up 2%:
I’ve spent the past week or two trying to ignore global politics - particularly Trump’s intervention in Venezuela, and also the unrest in Iran.
The markets haven’t been ignoring it, however. And the ramifications of these events, however grisly this might be, have been positive.
BAE Systems (LON:BA.) , for example, is up by a remarkable 20% year-to-date.
The saying “elephants don’t gallop” has never really been true, and certainly not for defence stocks during times of international tension.
BAE hasn’t even issued a relevant announcement - the price action of this £60bn stock has been entirely driven by external news. President Trump, in particular, has asked for US military spending to rise by over 50% to $1.5 trillion in 2027 (2026 budget: $901 billion).
Such a spending bonanza would ripple through the entire defence sector...