President Donald Trump decided to withdraw the U.S. from participating in the Iran nuclear non-proliferation deal May 8, 2018. While the sudden announcement surprised some, the move itself did not, as the deal had been a pain point for Trump since his 2016 presidential campaign. Multiple firms in the American aerospace industry saw immediate rises in their stock after the Iran withdrawal, which could bode well for their foreseeable future.
As of midday trading on May 10, the S&P Aerospace & Defense Select Industry Index was up by approximately 40 points. Lockheed Martin, Raytheon, Northrop Grumman and General Dynamics Corporation stand out as prominent stocks within this index. Aside from brief negative fluctuations that weren’t sustained enough to be statistically significant, this index has steadily risen since the Tuesday announcement.
Traders and business leaders are enthused by this latest uptick, as it comes just a week after a considerable sell-off of defense and aerospace stock shares. According to Investors News Daily, Lockheed, Northrop and other firms in this space experienced notable losses due to that sale.
Some companies in the industry, such as Boeing and Airbus, experienced setbacks as a result of Trump’s deal withdrawal. MarketWatch reported that the former aircraft manufacturer had plans to sell $20 billion worth of planes to Iranian airlines, while Airbus had a similar multibillion-dollar deal in the works. However, because none of the planes for these orders were built, neither firm stands to lose anything else beyond the potential business.