--- title: "The defense ETF Penghua is on the rise, as the geopolitical situation escalates, the military industry sector is rising against the trend" type: "News" locale: "en" url: "https://longbridge.com/en/news/280947398.md" description: "The geopolitical situation in the Middle East has escalated, and the military industry sector has risen against the trend. U.S. President Trump stated that the conflict with Iran has reached a \"significant day,\" and the U.S. military has destroyed multiple targets. CITIC Securities expects global military spending to reach USD 2.72 trillion in 2024, marking the largest increase since the Cold War. The U.S. has proposed to raise the defense budget for fiscal year 2027 to USD 1.5 trillion. China's defense budget for 2026 is set at CNY 1,909.561 billion, a year-on-year increase of 7%. As of March 30, the CSI Defense Index has risen by 0.27%, and the Penghua CSI Defense ETF has increased by 0.45%" datetime: "2026-03-30T03:04:14.000Z" locales: - [zh-CN](https://longbridge.com/zh-CN/news/280947398.md) - [en](https://longbridge.com/en/news/280947398.md) - [zh-HK](https://longbridge.com/zh-HK/news/280947398.md) --- # The defense ETF Penghua is on the rise, as the geopolitical situation escalates, the military industry sector is rising against the trend The geopolitical situation in the Middle East has escalated, and the military industry sector has risen against the market trend. On March 29, U.S. President Trump stated on social media that a "significant day" has arrived in the Iran conflict, and the U.S. military has destroyed many "long-coveted" targets within Iran. CITIC Construction Investment Securities pointed out that global military spending has reached USD 2.72 trillion in 2024, marking the largest increase since the end of the Cold War and continuing to grow for ten consecutive years. The U.S. has proposed a substantial increase in the defense budget for fiscal year 2027 to USD 1.5 trillion, an increase of over 50% compared to 2026. China's defense budget for 2026 is CNY 1.909561 trillion, a year-on-year increase of 7%. Although there is a slight adjustment, it remains at a peak of equipment delivery and upgrades under the guidance of the centenary goal of building a strong military. Defense investment is expected to continue to steadily increase during the 14th Five-Year Plan period. As of March 30, 2026, at 10:43, the CSI Defense Index (399973) rose by 0.27%. Component stocks such as Western Materials rose by 5.50%, Aerospace Nanhai by 5.45%, Guobo Electronics by 4.17%, Zhenlei Technology by 4.09%, and Aerospace Electric by 3.05%. The Defense ETF Penghua (512670) rose by 0.45%, with the latest price reported at CNY 0.88. The Defense ETF Penghua closely tracks the CSI Defense Index, which selects listed company securities under the ten major military industrial groups, as well as those that provide weapons and equipment to the national armed forces or have actual equipment manufacturing sales amounts or contracts with the military, to reflect the overall performance of listed company securities in the defense industry. Data shows that as of February 27, 2026, the top ten weighted stocks in the CSI Defense Index (399973) are Aero Engine Corporation of China, Aerospace Electronics, Philihua, AVIC Shenyang Aircraft Corporation, AVIC Optoelectronics, Ruichuang Micro-Nano, AVIC Xi'an Aircraft Industry Group, Western Superconducting Technologies, AVIC Onboard, and Haige Communication, with the top ten weighted stocks accounting for a total of 43.14% ### Related Stocks - [399973.CN](https://longbridge.com/en/quote/399973.CN.md) - [512670.CN](https://longbridge.com/en/quote/512670.CN.md) ## Related News & Research - [TRUMP SAYS MORE FIGHTING TO COME UNLESS IRAN GETS SMART](https://longbridge.com/en/news/287097488.md) - [TRUMP ON IRAN: WE HAVE TO GET THE RIGHT ANSWER](https://longbridge.com/en/news/287107535.md) - [TRUMP ON IRAN: NO RELIEF WILL BE GIVEN UNTIL A DEAL IS REACHED.](https://longbridge.com/en/news/287107877.md) - [WILL WAIT FOR IRAN RESPONSE FOR A FEW DAYS](https://longbridge.com/en/news/287107573.md) - [Iran's President Pezeshkian: Forcing Iran to surrender through coercion is nothing but an illusion.](https://longbridge.com/en/news/287105599.md)