Defense stocks in Europe and Asia soared on Monday as investors assessed how the dramatic overthrow of Venezuelan leader Nicolás Maduro heralds significant geopolitical changes that will foster rearmament trade in the long run.
line metalGermany’s largest arms manufacturer rose more than 7% in early trading, and military technology and surveillance specialist Hensoldt rose almost 7%. italian leonardo rose by 5.8%, and Germany’s Lenk rose by 5.8%.
Swedish fighter jet manufacturer serve It rose by nearly 5%.
Earlier, Japan’s IHI led the rally in Asian defense stocks, rising almost 10%, followed closely. Mitsubishi Heavy Industriesup 9.2%. Kawasaki Heavy IndustriesMeanwhile, it rose 6.9%. In South Korea, Hanwa Aerospace shares rose more than 6% and Pungsan shares rose 2%.
Fawaz Chaudhry, chief investment officer at Fulcrum Asset Management, said overthrowing Maduro was a “signaling exercise” to reshape geopolitics.
“When President Trump invoked the Monroe Doctrine, he was talking about controlling America’s proximate territory through hard power, through hard power assets,” Chaudhry said Monday on CNBC’s “Europe Early Edition.”
“We are talking about a world that is moving into a new era. [have] It will strengthen the hard power of military assets and take the initiative, but this is a fundamentally different policy than before. ”
Chaudhry predicted that this more aggressive US foreign policy approach would mean “more rearmament of Europe, more rearmament of Asia” in the long run, adding that defense stocks and military spending would continue to rise.
“What President Trump and the United States have done in Venezuela will actually strengthen it. With increased military spending and increased rearmament in Europe and Asia, that trend will continue,” he explained.
The rise of European defense companies marks a sharp reversal in a sector that has struggled in recent weeks amid the prospect of a possible peace deal between Ukraine and Russia.
