Defence stocks are soaring - but where's the extra military cash going?
The upcoming Strategic Defence Review may well conclude that it will take over a decade to transform the UK's armed forces into a “credible deterrent.”
Since Europe’s leaders started beating the war drums, defence stocks across the region have soared and continue to soar. Over the last two weeks or so since Prime Minister Keir Starmer announced that the UK’s defence spending would increase, quickly followed by the EU’s decision to re-arm the continent with £660 billion plus of new spending power, the value of defence shares have rocketed by more than £35 billion.
More pertinently perhaps, Europe’s Stoxx European Aerospace and Defence Index is now worth £106 billion, give or take a billion or two, since the start of the year, according to data from AJ Bell. And those investors who were prescient enough to anticipate what might happen after Russia invaded Ukraine three years ago, have now seen a whopping £250 billion added to the value of defence stocks listed on exchanges from London to Milan and Paris.