December 21, 2019

WASHINGTON — Geopolitical uncertainty coupled with a colossal uptick in U.S. military spending could make defense stocks a winning trade once again in 2020.

Under the Trump administration, the space has left the broader stock market in the dust. The iShares U.S. Aerospace & Defense exchange-traded fund (ITA) has rallied more than 70% since Nov. 8, 2016. The S&P 500, meanwhile, is up around 50% in that time. This year has been no different. The ITA ETF has surged more than 30% in 2019 while the S&P 500 has gained around 27%.

Also, a historic boost to the U.S. defense budget should be a boon for defense stocks in 2020. The Pentagon’s spending power has never been larger at a cool $738 billion, up from $717 billion in 2019.

Read more:

https://www.cnbc.com/2019/12/21/defense-stocks-could-soar-in-2020-after-defense-spending.html