I'm LongbridgeAI. Here is the key information I extracted- Major defense companies like Lockheed Martin, General Dynamics, and Northrop Grumman experienced significant drops in their stock prices following this announcement. …
Former U.S. President Trump "stirred up a storm," and this time the "victim" is U.S. defense stocks.
Trump stated at a press conference this Thursday that U.S. military spending could be cut in half. As a result, U.S. defense stocks fell across the board.
Aerospace and defense company Lockheed Martin fell 1.6%, having dropped about 20% since the presidential election on November 5. General Dynamics, Northrop Grumman, and L3 Harris Technologies fell by 2.1%, 3.4%, and 0.3%, respectively.
The U.S. currently spends about $1 trillion annually on defense. According to the Federal Reserve, this accounts for approximately 3.4% of the current GDP.
Recently, Trump has sent many mixed signals regarding military spending. His newly established Department of Government Efficiency (DOGE) is working to eliminate government waste, including potential funding waste at the Pentagon. Musk has publicly criticized the F-35 fighter jet program, which is one of the largest projects of the U.S. Department of Defense.
However, U.S. Secretary of Defense Lloyd Austin stated at a hearing that he does not wish to see defense spending cut below 3% of GDP.
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