Well, well, well. Just when defense stocks thought they were having the worst week ever, Trump swooped in like a financial superhero with a Truth Social post that basically said “Hold my Diet Coke.”
Here’s what went down: After Trump spent Wednesday telling defense companies they couldn’t buy back their own stock or pay dividends (ouch), he apparently had a change of heart. Or maybe he just remembered how much he loves big military budgets. Either way, Thursday morning brought a Truth Social bombshell: America’s getting a $1.5 trillion defense budget for 2027.
To put that in perspective, our current military budget is around $901 billion. So we’re talking about adding roughly $600 billion more. That’s like… a lot of fighter jets. Or submarines. Or whatever else goes boom in the name of freedom.
Trump’s reasoning? We deserve a “Dream Military” (his caps, not mine), and thanks to all those tariffs he’s planning, we can “easily” afford it. Because nothing says fiscal responsibility like spending your way to security, right?
Wall Street’s defense darlings went absolutely bonkers:
- Kratos Defense shot up 12% (apparently they make the good stuff)
- Northrop Grumman climbed 8% (stealth bombers don’t build themselves)
- Lockheed Martin gained 7% (F-35s for everyone!)
- General Dynamics rose 6% (tanks, but make it profitable)
- Raytheon managed a modest 2% (hey, gains are gains)
The timing is pretty wild when you think about it. This announcement comes right after the US basically played real-life Risk with Venezuela, capturing their president in what can only be described as the most dramatic foreign policy move since… well, ever. Plus, Trump’s been making noise about maybe, possibly, potentially taking over Greenland. You know, casual Tuesday stuff.
What’s fascinating is how quickly these stocks bounced back. Wednesday’s dividend ban had investors running for the hills, but one Truth Social post about military spending and suddenly everyone’s best friends again. It’s like watching your ex apologize with an expensive gift – you’re still mad, but that gift is really, really nice.
The defense sector has always been Trump’s favorite playground, but this feels different. We’re not just talking about maintaining military strength; we’re talking about building what he calls a “Dream Military.” Whether that means more advanced weapons, bigger fleets, or just really, really expensive military toys remains to be seen.
For investors, this is either the start of a beautiful friendship or the setup for the world’s most expensive buyer’s remorse. Defense contractors are probably already updating their PowerPoint presentations and dusting off their most ambitious project proposals.
The bottom line? Trump just turned defense stocks from Wednesday’s villains into Thursday’s heroes with one social media post. In 2026, that’s apparently how we do economic policy now. Buckle up, folks – it’s going to be an interesting ride.