Military stocks that were once considered reliable amidst global instability and conflicts have lost $98.08 billion in market capitalisation between January and October 11, 2023.
Data from Finbold indicates that ten major military stocks that boasted a market capitalisation of $665.48 billion on January 1, 2023, have dropped to $567.40 billion as of October 2023
Raytheon Technologies is the biggest loser, shedding $41.60 billion in market capitalization after beginning the year with a market cap of $148.36 billion. Following closely, Lockheed Martin saw the second-largest decline in market cap, losing $17.93 billion. Northrop Grumman recorded the third-highest losses, totalling $13.61 billion in market cap.
Boeing, which started the year with a market cap of $126.94 billion, lost $10.21 billion in capitalization. Other notable losers are BAE Systems ($6.44 billion), L3Harris Technologies ($6.06 billion), General Dynamics ($3.50 billion), Leidos ($1.43 billion), and Huntington Ingalls Industries ($0.46 billion).
Rheinmetall was the only exception among the top 10 major military stocks, gaining $3.16 billion, with its market cap increasing from $9.20 billion to $12.36 billion.
The Finbold report which underscored intrigues surrounding military stocks during armed conflicts, noted “In an industry that traditionally thrives during times of global unrest, the outflow in the market cap of military stocks may come as a surprising turn of events, especially in light of the ongoing major conflicts such as Russia’s invasion of Ukraine, which ranks at the forefront. Notably, the complex web of arms manufacturers, defence contractors, and government interests has historically thrived in times of conflict.”
It is worth noting that the shift in market cap does not signify the demise of the military-industrial complex; certain investors continue to appreciate its stability. Governments across the globe uphold significant defence budgets, guaranteeing the sector’s enduring presence.
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